Parliament Budget office: Enough 'fiscal space' for recently announced relief measures

Wednesday, 29 May 2019 21:04
REUTERS/Dado Ruvic
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Parliament's independent budget office on Wednesday's offered a much-needed "thumbs up" to the now besieged Tsipras government - some 40 days before a snap election - forecasting that there is enough "fiscal space" allocation for a so-called "13th pension" and modest VAT cuts.

The latter were abruptly announced two weeks ago by Prime Minister Alexis Tsipras, although the last-minute relief measures apparently failed to sway voters in Sunday's European Parliament election, as ruling SYRIZA party trailed main opposition New Democracy (ND) by 9.5 percentage points.

The Budget Office's view was included in a regular report on the execution of the state budget for the first quarter of 2019.

The report notes that the total impact of the announced measures is near 0.55 percent of GDP, according to accompanying reports compiled by the General Accounting Office. Conversely, "fiscal space" was calculated at 0.6 percent of GDP.

"There are no figures at this point that allow us to dispute the relevant forecasts by the General Accounting Office," Parliament Budget Office head Frangiskos Koutentakis, and former finance ministry official, said.

Kountetakis was appointed as the head of Parliament's independent Budget Office in March 2018, after a majority vote by committee members elected from leftist SYRIZA and the small right-wing Independent Greeks (AN.EL), when the two parties formed the one-time "strange bedfellows" coalition government up until early January.

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