One-off financial assistance: signal of stability or measure to be discontinued?

Over the past two years, during the pandemic, the Serbian state authorities gave 8.7 billion euros, or over 18% of Serbia’s GDP, in financial assistance to companies and citizens, Finance Minister Sinisa Mali told the Serbian parliament.

“We have fulfilled every promise we made, and we have demonstrated how strong and responsible our state is, and how solid and stable our finances are,” Mali said, explaining the regulation that amends the Law on the Provisional Register of Serbian Citizens Aged 16 to 29, who will still receive financial aid to mitigate the consequences of the COVID-19 pandemic.

The law, adopted by the National Parliament, stipulates additional 100 euros to be paid to this age group in the coming months. In early February, the same age group already received a one-off financial assistance of 100 euros. Although the Minister says that such a move by the government is a sign that state finances are stable, experts draw attention to the downsides.

The Budget Council warns that social policy that will be implemented in 2022, envisages non-selective benefits to large groups of citizens, a practice that according to the Council must be stopped. In previous years, the Council also had repeatedly analyzed non-selective payments of identical amounts to all citizens of age or all retirees, showing that this practice is not good.

This year’s budget also includes a one-off financial aid of 20,000 dinars for all pensioners, regardless of their material status, which will cost the state almost 300 million euros.

Instead of allocating such benefits, a truly efficient and fiscally responsible social policy would be to provide financial assistance to socially disadvantaged citizens.

The Fiscal Council reminds that in early 2020, the Government adopted the framework Law on the Social Charter, which stipulates the consolidation of all relevant data on the material status of citizens which are now grouped in one place.

(Nova Ekonomija, 16.02.2022)

This post is also available in: Italiano

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