Government approves draft of tight budget for 2001 and forwards it to Sejm

The government yesterday approved the budget draft for 2001 and forwarded it to the Sejm. The good news is that the budget is tight, with an economic deficit of just 1.6% of the GDP. The bad news is that according to many economists, the draft is based partly on unrealistic assumptions. The Cabinet assumed that the Sejm would pass a VAT law amendment to increase budget revenues, as well as an amendment on the Teachers'Charter to cut spending. "What if the Sejm rejects those bills?" asked Boguslaw Grabowski from the Monetary Policy Council (RPP). The budget also counts on saving another zl. 1 billion through more effective tax collection, another questionable assumption. Now the ruling Solidarity Election Action (AWS) is crossing its fingers that Freedom Union (UW) will supports the budget in the Sejm. If it is rejected, the President will have the right to dissolve the Parliament. (Gazeta Wyborcza, p.1)