NEZAVISNE NOVINE: The European Union is seriously worried about the growth of public expenditure in BiH, caused by increase in salaries in administration on all levels, said Fuad Kasumović, deputy minister of finances of BiH.
He clarifies that the exit from the current situation is a start of work of the Fiscal Council of BiH, which will set the sustainable frameworks of expenditure “from which no one could divert”.
NN: Recently you talked with the representatives of the EU about economic and fiscal policy of BiH. Did they give you standpoints of the EU on increase in salaries in the institutions of authority?
KASUMOVIĆ: The EU very clearly and decidedly said that they are seriously concerned about the growth of public expenditure in BiH, which was caused by increase in salaries on all levels of government in the country. There was a lot of heat around the law on salaries in the BiH institutions, and everybody forget that in expenditure state institutions participate with only 10 per cent. Nobody wants to ask a question what is with the increase in salaries in entities and cantons? The EU clearly said that BiH cannot afford growth of public expenditure, because we already have a very expensive and large administration.
NN: Are the BiH authorities worried about the growth of public expenditure?
KASUMOVIĆ: I think we all should be worried with increase in public expenditure. It is time we start acting responsibly. It is impossible to continue with the practice that every level of authority in the country acts independently. Today we have a situation that everybody increases their own salaries or public expenditure as they want and as much as they want. That leads us nowhere. State of BiH is like one family. If every member of the family takes as much as they want, the whole family will very quickly reach financial crash.
NN: What will the authorities do so we would not reach the financial crash?
KASUMOVIĆ: It is important that Fiscal Council starts to function as soon as possible. This Council exactly, in accordance with its legal competencies, will set the total framework of public expenditure, and measures within which every level of authority in BiH could move. Then we will not have a situation that anybody by their decisions endangers fiscal stability of the whole country. It will be known who and how much can spend.
NN: Does that mean that there could be decrease of large salaries of officials in entities and the state?
KASUMOVIĆ: With the law on salaries in institutions of BiH we wanted to set fair and honest relation and to regulate this area in a unified manner. However, fair and honest relation we cannot build on only one level of authority, but it has to be unified in all of country. I want to be precise to the end. Members of the presidency of BiH and the state prime minister have to be best paid, because we have to give significance to those functions. Then follow other officials in entities and cantons. We cannot have a situation in which entity prime ministers are better paid than the state prime minister. Same principle must be applied also for all other employees in institutions of government in BiH. With this, we must bare in mind how much the state can afford to spend on salaries. If present expenditures are over that amount, than it is logical that they have to be decreased.
NN: Are the salaries of entity officials too high and will they be to high of the state officials, once the law on salaries is adopted?
KASUMOVIĆ: We must decrease the public expenditure in the country, because we definitely have to expensive administration. That is related to the salaries as well. But, it is important to introduce fair and honest system, in which it will not be possible that an assistant minister in entity has bigger salary that an assistant minister in the state government. That is the principle we must uphold, and set the salaries in accordance with our possibilities.
“Demands of employees in state institutions are unrealistic”
NN: Employees in state institutions announced strike unless their salaries are increased by 40 per cent?
KASUMOVIĆ: Their demands are unrealistic, because the state cannot afford that. Our budget is limited and we cannot increase public expenditure. If we continue like this, we will draw all the assets from the economy and then what we will get? There is no need for employees to go on the streets and strike, because their demands are unrealistic.