September 21, 2018

Fiscal Council recommends the Government to not finance projects that benefit from EU funds

The Fiscal Council (CF) recommends the government to limit the expenses from own resources for projects with EU financing, in the context of repayments being blocked, and to strictly control the spending of local authorities, in order to avoid the risk of not meeting the budget deficit targets set for this year. According to the Council, given the extended suspension of repayments by the EU regarding the European non-reimbursable funds for a number of important operational programmes and the payments made in the first half of the year for projects with financing from non-reimbursable external funds (RON 6.37 bln) much superior to the incomes effectively received from the EU during the given interval (RON 3 bln), authorities must substantially slow down the increase of this kind of expenses in the second half of the year, in order to avoid endangering the budget deficit target, an acceleration being possible only if the effective repayments from the EU are rapidly unblocked. The Fiscal Council also presents a table with the cash flows in the relation with the European Union, and the available data place Romania on the last place in Europe, regarding the absorption. Out of an annual programme of structural and cohesion funds absorption worth EUR 3.78 bln, Romania absorbed in the first six months approximately EUR 713 M, slightly above 18 % of the total.
Source: Nine o’clock (read more)

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