State budget deficit lower than planned
According to the latest information provided by the ministry of finance, the state budget deficit in 2001 has proven to be significantly lower than the original allowance approved by parliament. Nevertheless, the deficit is the highest ever since 1993. Originally, the Lower House approved a state budget deficit of 49 billion crowns, and then nearly doubled the figures to 84 billion because of extraordinary expenses, such as drought compensation for farmers, and compensation for members of bankrupt credit unions. The Minister of Finance, Jiri Rusnok, announced that the Czech Republic's state budget deficit for 2001 reached just under 68 billion, more than 16 billion crowns less than that the numbers previously approved. Other factors that helped reduce the deficit included a lower than expected loss of the government's Konsolidacni agentura consolidation agency, lower expenditures of the National Property Fund, lower interest rates on the state debt and lower wage costs in the public sector. These factors compensated for higher payments of social benefits as well as for significantly lower revenue from the sale of third-generation mobile phone licences. According to data provided by the ministry, there remains a large volume of tax arrears. In November 2001, the amount of tax arrears reached 98 billion crowns. The figure has been decreasing slowly but steadily over the past months as the ministry of finance adopted measures to improve tax collection. Although the tax arrears amount to about 15 percent of the state budget, Mr. Rusnok does not see the problem of unpaid taxes as too threatening:
