Miller calls for interest rate cuts to support austerity budget for next year

The government yesterday unveiled an austerity budget for 2002 that it hopes will steer the economy away from a looming fiscal and economic crisis. The draft confirms that next year's deficit will be capped at zl.40 billion, with the country's income estimated at zl.143.9 billion and expenditure at zl.183.9 billion. The economy will grow at around 1%, and annual inflation is expected to be 4.5%. Finance Minister Marek Belka described the budget as a return to reality. Prime Minister Leszek Miller said, "This is a difficult budget, which will not be easy for either citizens or politicians. But we are all having to pay for four years of incompetent government." Miller also said that interest rates needed to fall by three percentage points to support the belt-tightening. Commenting on this, Monetary Policy Council (RPP) member Cezary Jozefiak said, "I am used to such pressures, this is only more detailed. We will continue to base monetary policy on a wide array of parameters, one of which is the budget." (Rzeczpospolita, pp. A1, B2; Reuters) P.J.