Sanader listed five basic objectives of the budget revision, those being support to the macroeconomic stability by reducing the deficit, support to economic growth, particularly to infrastructure projects and domestic production, reform of the education system, greater allocations for pensioners and war veterans, and promoting demographic renewal.
The prime minister noted that in addition to efforts aimed at strengthening the economy, Croatia would also have to strengthen its justice system and intensify the privatisation process.
Sanader and Finance Minister Ivan Suker presented figures on economic recovery.
Following a slowdown in the first quarter, economic growth picked up in the second quarter, resulting in increased budgetary revenue, Suker said, adding that in the first six months budgetary revenue was 6.7 per cent higher than in the same period last year.
Industrial production rose by 3.2 per cent, net salaries by 4.6 per cent, manufacturing industry by 4.4 per cent and tourism by 3 per cent.
Suker said that budgetary revenue would be reduced by 786 million kuna to 85.5 billion kuna, while expenditure would remain roughly the same, around 92 billion kuna.
Most of the budget funds, notably around 470 million kuna, will be allocated for pension allowances, and a further 346.4 million kuna for salaries.
By revising the budget, the government will support housing savings with an additional 70 million kuna, unemployment benefits with 60 million, additional maternity leaves with 39 million, and permanent entitlements for war veterans with 35 million.
At the same time, the government will reduce costs of acquisition of non-financial assets by 296 million kuna, material costs by 23 million, and various benefits for citizens by 111 million.
The new budgetary revenue is based on a realistic economic growth rate of 3.7 per cent and on the revenue generated so far.
The budget deficit will increase from the originally planned 3.7 per cent of Gross Domestic Product to 4.2 per cent.
Earlier in the day, opposition deputies walked out of the session in protest at the decision by the parliamentary majority to add about 15 more items to the agenda. They returned to the chamber later on.