Interview for Vijesti: Behind Closed Doors and Without Public Debate, Once Again

Marko Sošić, Public Policy Researcher at NGO Institute Alternative for daily newspaper ‘’Vijesti’’, on the Government’s work and the budget proposal for 2022:

In terms of transparency, not much has changed in the past year – during the term of Prime Minister Zdravko Krivokapić; budget proposal for the next year does not show a will for cutting current expenses; project ‘’Montenegro Now’’ is a sum of mostly sketchy project ideas without key capital budget reforms, while ‘’Europe Now’’ lacks analysis, and the draft laws which follow this project were determined without public debate.

This was stated by Marko Sošić, a Public Policy Researcher at the NGO Institute Alternative, in his interview for ‘’Vijesti’’.

When it comes to the transparency, in this NGO they noticed the readiness of the Government to provide data on the work of the previous establishment, rather than data on the work of the current one.

Sošić said that IA immediately received data on how the budget reserve was spent till 2020, but when it comes to data on how the inner cabinet of the Government is allocating aid in this year – there is no answer for five months. He pointed out that the General Secretariat of the Government is ‘’frontrunner’’ in ignoring all their requests and rejecting the initiatives to achieve a minimum transparency of the materials which are listed at Government’s agenda.

Late Reports

‘’The draft law on the budget for 2022 does not show a trend of cutting current expenses and unproductive budget lines. Although the Minister of Finance, Milojko Spajić, constantly repeats that they managed to reduce the current spending by 10% during this year without specifying how those savings were made – the data show a significant increase in the following year. The entire current budget is larger for almost 60 million. Expenditures for business trips increased for 40 percent, for representation for 30 percent, as well as controversial item ‘’other costs’’ that we criticized over years for lack of transparency’’, said Sošić, recalling that one year state gave 3.6 million euros in aid to Montenegro Airlines, justifying this expense as ‘’other costs’’.

He pointed out that costs for consulting services are growing, as well for the work contacts, other personal incomes, rent – all that the new ministers were criticizing during the mandate of the previous Government.

‘’Where are the cuts which were promised? Where is in-depth analysis of the expenditures which should show lavishness of the previous Government, and belt-tightening of current Government? We do not have a budget inspection, or a property register, or capital budget reforms – all of which would be natural priorities of a technocratic, expert government’’, Sošić emphasized.

He pointed out that the program budget was emphasized as the key reform move of the current Government which led to greater budget transparency, but that the key question is what do we know now, that we did not know before.

‘’Almost nothing. It is formalistic division of the budget of the institutions into programs, sub-programs and activities, in 2,000 pages. In these countless sheets, there are semi-finished indicators and objectives which are not linked to the government’s strategic plans and exist ‘’on their own’’, just to satisfy the form. We do not know how these indicators are met and no report on the execution of the program budget has been published yet, although there is a legal obligation on quarterly reporting’’, Sošić said.

IA emphasizes that the non-adoption of the budget leads to temporary financing and another crisis period, and that they hope that everyone will have enough responsibility not to allow that to happen.

Government has further complicated things by linking the budget to the measures from ‘’Europe now’’ package, thus bringing the Parliament to a final act – if one out of 10 laws submitted with the budget is not adopted or amended, the balance of the entire budget will be disturbed. The laws proposed by the MPs are also a significant challenge, from compensation to mothers to larger allocations for pensioners, without precise cost estimates – and all of this can kick the budget out of balance’’, said Sošić.

PR Package – ‘’Montenegro Now’’

He believes that the ‘’Montenegro Now’’ program is essentially overcrowded capital budget for next year wrapped in a PR package to make it easier to swallow, and that a more appropriate title would be: sum of mostly sketchy project ideas, without substantial capital budgeting reforms.

‘’How we select projects and how long we work on them, how big the unforeseen costs are and how poorly prepared the projects are – was not a priority during the selection of the projects. In the next year, twice as many projects are planned than in 2021, which is a huge burden for the two administrations that had problems even with fewer projects. In the first nine months of 2021, only 45 percent of the planned capital budget was realized. How will twice as many projects going to be implemented and why we are not focusing on already started projects? Two thirds of the new projects scored 50 or less points, which means that they are only half or less ready to be implemented. Some of the projects which are selected have scored only 15 points’’, said Sošić.

He said for ‘’Vijesti’’ that it would be much better if Government decided to try to complete the already started projects, to initiate the reform of capital budgeting and implementation of the recommendations of the State Audit Institution (SAI) and the International Monetary Fund (IMF). For me, that would be an approach more suitable for an expert Government, and I am sorry that they decided to go with sensationalism and explanation about biggest ever number of projects’’, said Sošić.

According to Sošić, the ‘’Europe Now’’ project suffers from lack of analysis, consultations, impact assessment, and excess of superficial propaganda and simplification.

‘’The question is not whether you want to live better and receive a bigger salary, because this is not even a question, thus it is intentional simplification. The real issues that needed to be discussed are whether we want to change the way we finance health care, how to ensure taxation of profits, higher excise taxes, how to strengthen institutions so that they can tax undeclared profits and reduce the grey economy. There are many questions about the feasibility of the revenue side and we are worried by the optimism of the Government when answering well-founded questions about whether it is really realistic that next year we will have additional 50 million from excise revenues, that we will have additional 25 million from corporate income tax, not to mention completely abstract categories such as additional 15 million from the reduction of the grey economy and additional 20 million from the taxation of undeclared incomes’’, said Sošić.

He believes that it is a pity that Ministry did not even try to find an agreement with political parties, both in power and opposition, for such far-reaching reforms having in mind that such major issues require a social agreement.

‘’How we will finance our health care system is an issue that goes beyond not only current Government, but this generation as well. Therefore, it is a pity that the MPs also heard about the ‘’Europe Now’’ plan just two months ago, the same as the entire public. No public discussion had been held on any of the ten laws that were submitted to the Parliament together with the budget proposal in order to implement the ‘’Europe Now’’ program’’, Sošić concluded.

Government to explain why they rejected the proposal to limit salaries

Sošić said that he hoped that all the data published by the Ministry of Capital Investments on public enterprises would result in systemic changes, not only public outrage and political skirmishes.

‘’The Government must explain why it rejected the proposal to regulate salaries and management bonuses, and what is the plan. If they want to establish order in current chaos in state-owned enterprises, they must systematically address the accumulated issues, primarily through the new legal framework for the work of state-owned enterprises and the establishment of a central body responsible for regulatory and supervisory policy in state-owned enterprises’’, Sošić said. The ‘’Montenegro Works’’ experiment suffers from the same lack of impact assessment and consultations as the ‘’Europe Now’’ and ‘’Montenegro Now’’ programs.

Interview was originally published on December 4, 2021 in the daily newspaper ‘’Vijesti’’

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