​​​"Cuts in public sector will begin in January."

"There will be reorganization or abolition of some agencies and administrative units. Austerity measures will be implemented," said Prime Minister Cvijanovic.

Moreover, the Prime Minister said that there would not be layoffs of employees in public administration. However, their number will be reduced as some of them retire, and the salary fund and vacancies will be limited.

-Our intention is to maintain the achieved level of income regarding the budget users. Salaries will not increase, and our goal is to improve the status of our pensioners –said Prime Minister Cvijanovic.

In reference to the economic development, the Prime Minister said that the Government was planning to maintain simulating tax policy, that is, the lowest tax rates in terms of taxation of property and income of citizens and business entities. Moreover, the Government intends to ensure obligation relief with a view to prompting business entities to employ new workforce.

The Glas Srpske:  What can the residents of the Republic of Srpska expect in 2015? What will be the priorities of the Government?

Prime Minister Cvijanovic: Our residents can expect the reform year with a considerable number of measures aimed at stabilizing the overall system, which was already defined by the Economic Policy.  We will try to maintain the achieved level of rights and benefits, which is evident in the planned budget. They can expect the year in which the investments in energy, health and infrastructure, flood protection system and other fields will be continued. This would then improve the life standard and the employment rate of our citizens. From all this, you may notice that our priorities are economic growth, improvement of economic liquidity, increasing employment, combating grey economy, better collection of public revenues and rationalization in all areas. 

The Glas Srpske: This year marked an increase of salaries of budget users, pensions and disability allowances. Will they remain the same or there will be changes?

Prime Minister Cvijanovic: Our intention is to maintain the achieved level of benefits regarding budget users. Salaries will not increase, and our goal is to improve the status of our pensioners. Furthermore, a better collection of public revenues must be ensured as well as more efficient work of control and inspection bodies.

The Glas Srpske:  By what measures do you plan to implement the planned cuts in public expenditure and will there be layoffs in the public administration?

Prime Minister Cvijanovic: Right now it is not our plan to dismiss people. However, the salary fund shall be limited and there will not be additional hiring. Furthermore, new employees will not be hired instead of the retired ones, except in exceptional circumstances should the lack of new employment severely hamper working activities. Nonetheless, I deem that is not the case in the public administration, as the reallocation and reorganization of staff ensures uninterrupted functioning. In addition to that, some agencies and administrative units will be abolished or reorganized and the new Government will deliberate those issues in January. All material costs were reduced for 30 percent and austerity measures will be applied in every domain. This should result in the reduction of public expenditure, and the measures will have to be implemented both at the local and entity level.

The Glas Srpske: One of the goals of the Government is creating more efficient public administration which would provide better services to business entities and citizens. Will the irresponsible official be sanctioned?

Prime Minister Cvijanovic: Yes, they will. Deadlines must be met and officials must demonstrate greater accountability towards the users of the administration's services. Civil servants are already privileged by having better incomes and working conditions in comparison with workers in the economy. And that must be justified by the higher level of accountability and service quality.

The Glas Srpske:  We have seen that the Government intervened in companies facing difficulties. What is the plan for saving the troubled companies and strengthening the economy?

Prime Minister Cvijanovic: First of all, we must approach those issues more boldly and we will continue to intervene in the forthcoming period. Our goal is to find strategic partners for some business entities. One of the already defined tasks of the Government is to determine business entities' sustainability through certain analyses. That is, surely, a demanding task. As a reminder, the Government in its limited mandate of one year and a half managed to save many jobs. We will have to introduce more demanding management structure since we have not still encountered that some of these companies presented a plan or at least a vision how to overcome the problems and what measures they plan to implement with our support or what the expected outcome may be provided these measures are implemented.

The Glas Srpske: The registration of business entities has been realized as one of the goals of the previous Government. However, the problem remains with those owners with large arrears who can register another company and continue operating leaving behind them unsettled debts.

Prime Minister Cvijanovic: The new registration model is one of the best in the region. Our intention is to send a message to foreign investors and to foster self-employment. Through the Economic Policy we announced that the Government would introduce a regulation prohibiting the establishment of new business entities by the individuals who are the owners of the blocked and insolvent business entities or who have outstanding tax obligations.   

The Glas Srpske: Better collection of public revenues and supervision of the public spending are recurring issues. What are the Government's plans for achieving that?

Prime Minister Cvijanovic: We have announced that special attention will be paid to the activities of regular and enforced collection of all public revenues and of indirect manner of determining the tax base and related inspections carried out by the Tax Administration. Through the amendments to the Law on Tax Procedure, we shall oblige the Tax Administration to control the manner of the payment of taxes and contributions including the method of their calculation. Moreover, the program for combating the grey economy will be introduced, which should result in a better collection of budget and non budget funds, and combating illegal activities and illegal employment. New laws on inspections will also be adopted in order to ensure more efficient functioning of the Inspectorate of the Republic of Srpska.

The Glas Srpske: How do you plan to unburden the economy given the fact that it is one of the most important requirements of the business community of the Republic of Srpska?

Prime Minister Cvijanovic: We have defined a series of measures in the new laws or amendments to the existing laws aimed at unburdening and increasing the liquidity of economy, as well as prompting new employment. We intend to maintain the growth tax policy, or the lowest tax rates regarding the taxation of property and income. Furthermore, we intend to provide obligation relief to the companies hiring new staff. With the help of the EU Commission, the World Bank and the IMF, we will make an analysis of the tax system and the share of tax revenues to GDP in order to create the best tax burden especially in terms of labor taxation, that is, income and mandatory contributions tax. The register of all fiscal and quasi-fiscal payments shall be established so that there will not be possibilities for increasing the existing obligations, and some of them might be eliminated.  We will also amend the Law on Administrative Fees. In order to improve the economy liquidity, we shall introduce the Law on Deadline for Financial Settlement and we will start applying the Law on the System of Multilateral Compensation and Cessions. With regard to the BiH level, we shall initiate the amendments to the Law on VAT with a view to prolonging the deadline for paying the VAT, as well as to the Law on Administrative Fees. Ultimately, the Economic Policy for 2015 defines many other measures which we plan to implement regarding this issue.  

The Glas Srpske: The Strategy for Combating Corruption has been adopted. However, the Commission has not yet started to work. When can we expect the results?

Prime Minister Cvijanovic: Unfortunately, not even after we repeated several public calls, did the representatives of the media and academic community apply, which surely implies that we like to talk and discuss deviations but we are not that willing to face and do something about them. Basically, action plans have been prepared, and the Strategy was made in cooperation with European partners modeled on modern practices in the EU. Institutional framework and legislation were also developed through the cooperation and on the basis of joint documents and agreements. Nonetheless, the entire system must be constantly improved and the Government is committed to doing so.

The Glas Srpske: What activities will you undertake regarding the outflow of the money of public institutions and the unsustainable companies?

Prime Minister Cvijanovic: We have presented objectives and measures regarding public institutions. Those include more responsible management, rationalization of expenditure, and reorganization of the number of employees. We have started that in the previous period, and will continue to work on solving those issues as that is one of the priorities of the Government.

The Glas Srpske: How do you respond to the criticism of the Opposition that the Government is taking out too many loans?

Prime Minister Cvijanovic: There is no reason for criticism. We are not a heavily indebted country. We service the debt regularly as well as all existing obligations.

The Glas Srpske: How would you evaluate the situation at the BiH level? Can we expect the progress regarding the EU integration given that the order of the criteria has been rescheduled but not the requirement themselves?

Prime Minister Cvijanovic: I would evaluate the situation as very perplexed and alienated from the political and economic realities and the needs of the citizens from both entities. I am pleased that we managed to constitute the legislative and executive authority, and to adopt Economic Policy and the budget for 2015. However, that is not the case with the BIH level. Had the principle of the winner parties forming the authority levels been taken into account, the executive authority at the BiH level would have been established. Nevertheless, instead of that, Mr Bakir Izetbegovic and Mr Emir Suljagic continued playing with the policy of the HDZ in the Federation of BiH, and when it comes to the parties from the Republic of Srpska they chose the Opposition for their partners. By doing so, they want to foreground the BiH level, since they failed to diminish the power of the HDZ in the Federation of BiH and the SNSD in the RS. I, personally, am looking forward to the establishment of the government at the BiH level and to see them enthusiastically implementing all they have promised. With such governing authority at the BiH level I expect no progress towards the EU. According to their previous statements, I must notice that they are not aware of what should be done and how to implement certain processes.

The Glas Srpske: What are the priorities in reference to the foreign policy?

Prime Minister Cvijanovic: We shall continue strengthening the position of the Republic of Srpksa through institutional and any other forms of cooperation and communication with partners worldwide. Some of them demonstrated a very good understanding for us. Our priority is to make the European integration process more domestic and less foreign, provided the all levels of the authorities in BiH act in a coordinated and reasonable manner. ​