At the sitting held on 23 November, the Finance Committee accepted, in principle, the Bill amending and modifying the 2010 Republic of Serbia Budget Law, with its accompanying proposals of decisions granting consent to the amendments and modifications to the financial plans for 2010 of: 1) the Republic Fund for Pension and Disability Insurance of Employees, and 2) the National Employment Service.

The Committee members also accepted, in principle, the Bills amending and modifying the Law on Deposit Insurance; amending and modifying the Law on Deposit Insurance Agency; amending and modifying the Law on Prevention of Money Laundering and Financing of Terrorism; Granting Guarantee by the Republic of Serbia in favour of Export Development Canada under the debt of RTB Bor - Mining-Smelter Basin Group Bor d.o.o. in restructuring; on the Confirmation of the Loan Agreement for the Privileged Buyer of Zemun-Borca Bridge Project with accompanying roads between the Government of the Republic of Serbia as borrower and the Chinese Export-Import Bank as creditor, on the Confirmation of the Guarantee Agreement (EPS Counters Project) between the Republic of Serbia and the European Bank for Reconstruction and Development; on the Confirmation of the Guarantee Agreement (Serbian Railroads: Corridor X) between the Republic of Serbia and the European Bank for Reconstruction and Development and on the Confirmation of the Guarantee Agreement (Belgrade Bypass/B) between the Republic of Serbia and the European Investment Bank.

The Bill amending and modifying the 2010 Republic of Serbia Budget Law, with its accompanying proposals of decisions granting consent to the amendments and modifications to the financial plans for 2010 of: 1) the Republic Fund for Pension and Disability Insurance of Employees, and 2) the National Employment Service was explained to the Committee members by Minister of Finance Diana Dragutinovic who stressed that the Bill does not represent a statistically significant alteration compared to the 2010 budget and that all the alterations have a social character. The Bill complies with Serbia’s programme with the IMF and the agreed on 4.8% GDP budget deficit. She pointed out that there are strong indications of economic recovery, the third quarter experienced a 2.1% growth compared to the previous year, and the growth, excluding agricultural production, amounts to 2.5%. Unlike any other country in the region, Serbia experienced growth in the third quarter. The inflation exceeded the adopted limits of 6% +/- 2 for the first time in October. The drafting of the Bill followed the same logic as the drafting of the 2010 budget, the expenditure was frozen opening up more room for state subsidies. The income is 660 billion RSD, expenditure 780 billion, and the budget deficit is 120 billion RSD and is harmonised with the IMF. In the expenditure structure the highest percentage goes for social costs, regular transfer to the pension and disability fund for the regular payment of pensions was raised to 7 billion RSD, the one-time assistance of 5000 RSD for administration employees and pensioners was taken into account, 3 billion RSD were allocated to social security, 2.2 billion of which for regular payments, while 800 million is intended for poor municipalities, funds were secured for the heating season by settling the debts to the City of Belgrade and heat power plants, as well as fees for construction land for Serbian municipalities. In addition, accommodations were made for commodity reserves (400 million for mazut), transfers to municipalities were raised by 1 billion RSD, 500 million of which would go to all municipalities, while the remaining 500 would go to the 40 poorest municipalities, stated Minister Dragutinovic. She added that the rebalance is characterised by social cohesion and economic subsidizing, as well as increase of income with a different structure.

Debating this item on the agenda, the Committee members made several observations and had questions about the decrease in capital expenses, financing of local self-governments and AP Vojvodina, the transfer of 500 million for the 40 poorest municipalities, income structure etc.

Following the debate, the Committee members accepted the Bill, in principle, by a majority of votes.

The Committee members went on to debate the remaining items on the agenda and accepted them in principle, by a majority of votes. Committee Deputy Chairperson, Branka Ljiljak was appointed rapporteur.

The sitting was chaired by Zoran Krasic, Committee Chairman.