In the revised budget, revenues go up to HRK 110.3 billion, expenditures to HRK 120.3 billion and the deficit to HRK 10 billion. The budget deficit accounts for three per cent of gross domestic product and is HRK 4 billion lower on the year, or 1.2 per cent in GDP terms.
The general government deficit is projected at 3.5 per cent of GDP. The deficit of the extra-budgetary funds is 0.3 percentage points higher because of the increased investments by the Croatian Waters and Croatian Roads companies.
The government predicts for this year a 1.1 per cent GDP decline, mainly because of reduced personal spending, and a 3.4 per cent average inflation rate.
Finance Minister Slavko Linic said the budget expenditures were HRK 1.6 billion higher than anticipated, mainly because of the salaries of budgetary beneficiaries.
Financial expenditure went up HRK 416 million to pay for the Brodosplit shipyard's debt interest and for interest on bonds issued in the US, and subventions grew by HRK 380 million, including HRK 340 million for Brodosplit.
The government said the preservation of the planned deficit was a success, notably because of the state of the economy, which Linic described as "critical."
Prime Minister Zoran Milanovic said the budget revision represented neither austerity nor anti-recession measures but an alignment of the budget with responsible management of the state finances.
Commenting on the exceeded budget for the public and civil sector, Milanovic said nothing was changed in the sector and no entitlement was touched despite the four-year economic crisis.
We can no longer carry the burden of such public spending, the economy has dropped, yet the budget costs have remained the same, said the PM.
In the 2013 draft budget, which will be presented on Monday, the government will move a HRK 1.5 billion cut in costs for public and civil sector employees, primarily to bring order to salary bonuses.
(EUR 1 = HRK 7.53)