Finance is communicating with Brussels regarding a new plan to control spending in the medium term

The Ministry of Finance is already in contact with the European Commission to prepare the new structural plan for the medium-term national budget regarding expenditure control, which is scheduled to be submitted to Brussels in October once it is finalized.

While the new EU budget rules, which oblige countries to prepare a national medium-term structural plan for the budget, are coming into effect, the Portuguese minister responsible for them, Joaquim Miranda Sarmiento, told Lusa that he has already begun “communications.” [com a Comissão Europeia] And internal work in the Ministry of Finance” within the scope of this preparation.

“The work will continue until mid-October, and therefore the delivery of this plan will be in sync with the state’s general budget for the year 2025. We will wait for what are the first indicators from the authority, and they are subject to negotiation.” [mas] “There is actually a rule to control spending,” the government official added.

Meanwhile, “there are two other rules that are equally important, [como] Joaquim Miranda Sarmiento pointed out “maintaining the budget balance and continuing to reduce the public debt.”

“By keeping the budget balanced and with the expected growth rates of the Portuguese economy, public debt will continue to decline by about 45 percentage points per year, and this makes us very comfortable from the point of view of what is the budget perspective for the future.” Years,” the minister confirmed.

The official added, “The goal is to maintain the balance of public accounts, and yet continue to reduce public debt and reach about 80% of GDP in 2028, when the Legislative Council ends.”

At the end of last April, the European Union began implementing new community rules for the deficit and public debt (but while maintaining the ceiling of 3% and 60% of GDP, respectively), due to the reform of the bloc’s budget rules approved by the European Union. Member states will begin applying in 2025 after developing national plans.

It is now planned that by the autumn, member states will submit multi-year plans to Brussels, covering four or seven years, which will then be discussed with the Community’s executive so that the rules are fully implemented in 2025.

According to the new rules, member states must then prepare their medium-term national structural plan for their budget, in which they commit to following a multi-year path for net public spending and explain how they intend to implement priority investments and reforms.

Today in an interview with Lusa, European Commission Executive Vice President Valdis Dombrovskis said that on Friday Brussels will publish a reference path for each country, specifically Portugal, indicating how the country should reduce its public debt.

In his statements to Lusa, Joaquim Miranda Sarmiento also said that the executive will present in October the proposed state budget for 2025, “which will have a slight ‘surplus’ estimate.” [excedente]Which this year amounts to about 0.2% – 0.3% of GDP and a similar value next year.

When asked about the Bank of Portugal’s warnings about a possible return to deficit, due to measures that have an impact on the budget such as tax cuts and salary negotiations in the public administration, the Finance Minister attributed the warnings “to what the government’s decisions were.” Parliament in the absence of the government.”

“We are talking about hundreds of millions of euros, and clearly this should be a cause for concern because it does not fall within the scope of government decisions,” he said. […] If they come to join others […] “It is, in fact, possible to move from a ‘surplus’ to a deficit,” the government official told Lusa.