Finance Minister Mário Centeno will be heard at the Parliamentary Committee on Budget, Finance and Administrative Modernization (COFMA) next Wednesday, May 15, and it is likely that issues will be entered for this hearing on the Stability Program ) 2019-2023, in particular as regards the impact on public accounts and the fulfillment of EP targets resulting from the counting of full-time service in the special careers of the Public Administration, according to the UTAO document – Technical Support Unit for Budget had access.
The UTAO quantifies this impact at around 400 million euros, in a cruise year. That is, the full-time accounting of public administration careers risks the goals of the Stability Program.
In addition to this approach, Mr Centeno should also be asked about the concerns expressed by the Court of Auditors regarding the way in which the reform of public financial management is implemented, the report says.
The assessment of the extension to all special care of the principle of full recovery of hours of service provided for remuneration progressions foresees a deterioration of EUR 398 million in the budget balance and in the structural balance in the cruise year vis-à-vis the EP / 2019-23, "says the UTAO report on the Stability Program 2019-2023, completed on May 7.
Thus, "as a percentage of potential GDP, the structural balance goes from 0.3% to 0.1%, with Public Finance more likely to fail the medium-term objective rule," the UTAO document states.
We recall that the Ministry of Finance has already carried out a downward revision to the growth forecast for 2020, however, keeping it above the forecasts presented by most other institutions.
Mário Centeno's current growth forecast for 2020 is 1.9%, which is the same as for 2019, but represents a downward revision of -0.4 pp, compared to the year presented in the EP previous.
The timely projection of Finance for 2020 is also more optimistic than that of other reference institutions, with the exception of the OECD.
It is recalled that the most recent forecasts presented by the main institutions also revised down the expected growth for Portugal in 2020.
Given the evolution of forecasts by the OECD, the EC, the CFP – Public Finance Council and the BOP, the UTAO document states that most of these institutions admit as a common feature "the expected slowdown in growth for the Portuguese economy."
"Except for the IMF which, in April, kept the previous forecast for 2020 at 1.5%, being the most contained of all forecasts. The forecasts made by the Ministry of Finance follow the same pattern, but are more optimistic than those presented by the majority of these entities (with the exception of the OECD, whose most recent forecast dates from November / 2018), "says UTAO's analysis.