An analysis of several months of budgetary expenditures at the state, entity, cantonal and municipal levels showed that about EUR 6 billion of the budget goes on salaries, public administration expenditures and social contributions.
"This approach makes the budgets in Bosnia and Herzegovina untenable, they can't be separated, they are treated as election spoils and serve to finance red tape and apparent social peace," said CCI project manager Adis Arapovic.
About 30 per cent of the budget (approx. EUR 1.65 billion) goes on public sector salaries, 18% (some EUR 1.35 bln) on material and services, and 37% (about EUR 2.15 billion) on social contributions. Arapovic said this was unacceptable because the state's debt was constantly growing and the state could not service its needs.
"The external debt is close to seven billion (convertible) marks (approx. EUR 3.5 billion) and it will take 20 years to service it," he said.
He warned that audits of public money spending gave negative evaluations of government institutions but that no one had been held to account.
The Bosnian authorities have a stand-by arrangement with the International Monetary Fund worth about EUR 407.5 million to cover the budgetary deficits.