Finance Minister's budget plan under fire from central bank and SLD

Finance Minister Jaroslaw Bauc's budget plan, which envisages the freezing of welfare spending, the raising of excise duties and the imposition of temporary taxes on imports, was heavily criticized yesterday by both the central bank and the left-wing opposition. Bauc wants to restrict the 2002 budget deficit to zl.33.7 billion, which is the equivalent of 4.3% of GDP, having claimed that the deficit could reach 11% if cuts are not applied. However, central bank governor Leszek Balcerowicz warned against too extensive borrowing by the government, as this could affect "sustainable economic growth". Meanwhile, the opposition Democratic Left Alliance (SLD) said it would only support the spending cuts if it was clear that they were absolutely vital. At the same time, the SLD also raised questions about Bauc's budget arithmetic. The government will today discuss the budget plan, but it remains unclear whether it will support Bauc's call for deep spending cuts before next month's general election. (Reuters)