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The Government of Kosovo held its regular meeting

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Prishtina, 30 June 2017

The Government of the Republic of Kosovo, led by Prime Minister Isa Mustafa, has held its regular meeting, the 148th in a row, in which it approved documents and decisions in the area of constitutional and legal responsibilities.

The first item that received the approval of the government cabinet was the decision on drafting the Economic Reform Program 2018-2020, as part of the dialogue between the EU and the Republic of Kosovo in the field of economic governance. The Economic Reform Program covers the mid-term period 2018-2020 and is based on the macro-financial framework, structured priorities and other measures of the Government Program 2015-2018 and the National Strategy for Economic Development. Through the Economic Reform Programme, and based on the instructions of the European Commission, the recommendations and other joint conclusions deriving from the economic and financial dialogue between the EU and Western Balkans have been reported and included in this programme. The national coordinator for economic reform shall be the Ministry of Finance, with the inclusion of the Office for Strategic Planning in the Office of the Prime Minister, the Department for Economic, Public Policies and Financial Cooperation in the Ministry of Finance and other line ministries, according to need for inclusion in the economic reform program. Particularly, this program shall include public finance management, energy market, transport and telecommunications, sectoral developments, environment, reduction of informal economy and other issues related to this reform.
 
The Annual Plan on Statistics 2018 also received the approval of the government cabinet. This annual plan foresees and includes priorities of the Agency of Statics, including human and financial resources available. This program also includes the international methodology under EUROSTAT standards and other relevant statistics that will be credible to the citizens of the Republic of Kosovo, as well as the institutions in terms of decision making.

The government also approved the decision to further review the request for expropriation for public interest of the cadastral parcel no. 13050-0 which will be affected by the construction of the Police station in the Zubin Potok municipality.

The Government approved the Decision on recommending the President of the Republic of Kosovo to grant authorization to the Minister of Finance to sign the Agreement between the Republic of Kosovo and International Development Association on additional funding for the project of agriculture and rural development.


The Government Cabinet also approved the decision on allocation of funds for the needs of Kosovo customs.
Kosovo Customs have submitted a request for additional funds amounting to euro 342 thousand, due to the lack of budget review for this year. These funds, namely euro 235 thousand, are dedicated to the supply of banderols for import of cigarettes and alcoholic beverages, and another euro 72 thousand needed for the purpose of covering rent for new facilities leased by the Customs, and some other contracting expenditures related to the implementation of the Government Decision No. 22.06.2016.

The Government also approved the Decision on allocation of funds for compensating top-ups and financial incentives for 85 judges in serious crimes departments for 2017. Kosovo Judicial Council requested that all serious crimes judges are provided with a top-up of euro 300 in a linear manner, as an additional mechanism to promote increased efficiency in combating organized crime. The request for funds amounted to euro 321,800.00 for 85 judges in the Serious Crimes Departments in the Supreme Court, Court of Appeal and Basic Courts in Kosovo. The funds have been foreseen under the regular budget of the Judicial Council.

The decision on amending and supplementing the Government Decision No. 03/104 dated 10 August 2016, on the date for commencing collection of premiums for health insurance was also approved during today’s meeting.  “The Ministry of Health has continuously worked toward creating conditions for making the Health Insurance Fund functional, and commencing collection of premiums, and based on the aforementioned Government Decision on necessary preparations, the Ministry of Health has adopted and presented before the Government the action plan for preparatory activities on commencing the collection of premiums as of 1st of July 2017. Under this plan, one of the key points, that was foreseen and harmonized with the Parliamentary Committee on Healthcare and Social Welfare, was the amendment of the Law on Health Insurance, which was to be done in the period March-June 2017, however, since the Assembly was disbanded the law could not be amended and thereby obstacles were created to the preparation process for commencing collection of premiums. Additionally, due to these events, delays have been marked in other activities related to the Health Insurance Fund. Based on the factual situation and the need of having these preparatory activities completed, I propose to postpone the collection of premium until the completion of preparations foreseen under the action plan”, stated Minister Rrahmani.
Prime Minister Isa Mustafa stated that the decision is that the collection of premiums start on July 1st. "This decision was also related to the supplementation and amendment of the law in the Assembly, which we failed to do because of the motion of no confidence in the Government and the dissolution of the Parliament, namely, the issues have remained outstanding. Therefore, it would be good for us to change our decision, to leave open the possibility that when the future Assembly and the Government are constituted, they continue this procedure, but the dates are to be determined by them, and not by us, because we can not determine the date when the next Assembly will amend and supplement the law and when all legal conditions will be met to start collecting the premiums. Therefore, I ask you to make the change, and leave the possibility open for future institutions of the Republic of Kosovo to then decide, “said Prime Minister Mustafa.

At today's meeting was approved the decision to recommend to the President of the Republic of Kosovo the granting of authorization for signing the Financing Agreement for the  Competitiveness and Export Readiness Project between the Republic of Kosovo and the International Development Association. The project aims at advancing trade legislation and creating an appropriate export environment according to international standards in accordance with the Law on International Agreements.

The Kosovo Labour Relations Report on Financial Reporting also received the Cabinet approval. The Kosovo Financial Reporting Council during the reporting period has been mainly focused on the advancement of financial reporting, auditing and quality control of financial data.

The Cabinet was briefed on the report on public revenues and expenditures performance. The Minister of Finance said that for the period January to May 2017, total revenues increased by 3.4 percent, which is 20.8 million more than in the previous year.

Prime Minister Mustafa asked at the end of the meeting to look at the issue of the Budget Review and some of the obligations due. "We do not have the Assembly, and we have big problems on how to deal with them. I would like to ask the minister to present these problems to us along with it, and then we can sit in an upcoming meeting to talk about what to do because there are some obligations that can not wait around. It is my wish that the Assembly and the Government be constituted tomorrow, so that the institutions of the Republic of Kosovo can be functionalized to solve these problems, but the objective problems are just ahead of us, "said Prime Minister.

Regarding the Budget Review Minister Hoti said that in the absence of the review there will be difficulties encountered in meeting the obligations. "The first is related to pension and social schemes, due to the lack and delay in reclassification of war veterans. We should, according to the law, continue to pay war veterans with the amount as determined by the Government's decision in 2015. Based on the forecast made with the Ministry of Labour, we here have a deficit of euro 24 million to end  the year in accordance with legal obligations.
Second, we have an obligation for the Highway Prishtina-Hani i Elezit, a considerable part of the obligations we have for this contract are foreseen to be met by the funds coming from the PAK, for which we need to amend the Law on PAK,  to enable the withdrawal of these funds. The law is ready but in the absence of a functional Parliament it is impossible to proceed further. Here we are talking about euro 80 million, for which we need to find forms how to redistribute, reallocate from other projects.
Third, the funds we need for local elections because we have spent the funds we have foreseen in the regular budget for local elections this year, i.e. were spent on general elections.
Fourth, there is the Arbitral Tribunal's decision on the euro 5.3 million contract of the Ministry of Internal Affairs on the issue of passports, for which the final decision is expected soon, and this will be an extra burden on the Ministry of Internal Affairs, because according to the law this obligation should be paid from the budget of the Ministry of Interior. We have another euro 0.6 million obligation to pay off the obligation to draft the Trepça feasibility study we initiated with the Ministry of Economic Development and PAK. Thus, in total there are euro 112 million of budget deficit due to the non functioning of the Parliament and the inability to review the Budget. We should make the most of the opportunities provided for within the law for reallocations up to 15 percent, within the Ministry of Finance and up to 25 percent in the Government. I expect that institutions are constituted as soon as possible and we move forward with budget implementation as approved in the Kosovo Assembly. I believe that in a future meeting together with relevant ministers we need to go into more detail into these issues, i.e. those who are related to these issues to find a solution, in the absence of Parliament and budget review, "said Minister Hoti . 

Prime Minister Mustafa spoke about the revenues and expenditures performance. "As far as budget revenues and budget expenditures are concerned in relation to the Budget Law, the latter is an issue about which we should think about making preparations, designing solutions, so we will not be challenged with these obligations that we have. I also talked with the Minister of Finance to have a proposal come from the Minister in cooperation with other ministries, because in the situation when we can not make a budget review, then we have to give up some of the obligations that we have or some plans that we have as a ministry and as a government to fulfil some of these obligations. Meanwhile, with the budget review at the moment when the Parliament is constituted and the next Government is elected, these plans are met which are with certain ministries, "said Prime Minister Mustafa.

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