Salary freeze to be lifted in January 2011

- Minister of Finance Diana Dragutinovic has confirmed that an agreement has been reached with the IMF that the public sector salary and pension freeze will continue to be in place until the end of this year and that in 2011 three adjustments will be made, in January, April and October - it is stated on the website of the Serbian Government.

In an interview for tomorrow’s edition of the Ekonomist magazine, Dragutinovic said that in January 2011 salaries and pensions would be increased in accordance with the six-month inflation, or by a little less than 3%.

In April, they will be adjusted for three-month inflation and half of the GDP growth rate, while in October, adjustments will made for six-month inflation, she explained.

According to the Ministry of Finance, a further RSD 12 billion will have to be set aside for this purpose in the 2011 budget, nearly RSD 4 billion more than was agreed upon in an earlier agreement under which salaries and pensions were to remain unaltered until April next year, she outlined.

She emphasised that the fiscal responsibility bill had been finalized with the IMF and that it would be put before the Parliament by 20 September 2010 at the latest. The adoption of this bill is a condition for the approval of the fifth revision of Serbia’s standby arrangement with the IMF.

The bill will ensure that the fiscal deficit in 2011 does not exceed 4% of GDP, concluded the Minister.

Ministarstvo finansija Republike Srbije

Međunarodni monetarni fond-MMF Beograd

Vlada Republike Srbije

Diana Dragutinovic

IMF

salaries

GNP

gross national product