Finance Minister Zdravko Maric said on Monday the ruling coalition partners supported the government's 2020 state budget revision and 2021 budget.
"They are aware of the circumstances and how much coronavirus has cost the state budget to date. The figure will go up to 28.5 billion kuna by the end of the year. These are increased expenditures that we didn't plan which are first and foremost intended for job retention and the health system," Maric told the press after meeting with the ruling HDZ's coalition partners.
Maric said challenges still existed and that they were basing the 2021 budget on macroeconomic projections which they would keep to.
He said there remained major negative risks for achieving the GDP projections as well as "certain positive ones, first and foremost related to EU funds, the Next Generation EU, the Recovery and Resilience Facility, something on which we are putting a lot of emphasis already in next year's budget."
Maric explained that Croatia would receive from the React EU fund €210 million this year and €330 million the next for job retention measures. "As for the rest of the €800 million, a smaller part will go to healthcare and the bigger part to support the economy."
As for the Recovery and Resilience Facility, he said 10% of €6 billion in grants would go towards strengthening the government's capacity to help the economy. He underlined that reforms would be key for absorbing the money.
Asked where he found the money for paying hospitals' debts to drug wholesalers, Maric said it would be seen in the revised 2020 budget.
He said liabilities in healthcare exceeded 10.5 billion kuna but added that "by resolving the issue of existing debts, we haven't fully solved the problem because new debts are being generated, about 220 million kuna a month."
Maric went on to say that the dialogue with the social partners would continue this week. "The intention is to present where we're at and begin a dialogue on... salaries in the public sector."
He said a lockdown was not on the table at the moment.
Regional Development and EU Funds Minister Natasa Tramisak said the coalition partners were also presented a national development strategy until 2030 which will soon be put to public consultation.
"We agreed at the meeting... that it is a comprehensive, umbrella, strategic document which provides clear directions and visions of Croatia in the next ten years. We wish to achieve a more competitive and stronger economy in order to improve living and working conditions and so that the state can achieve a better quality of the standard of living," she said.
(€1 = HRK 7.57)