Portuguese 2011 State Budget

In the end of all questions between the two major Portuguese parties was voted and approved the 2011 Portuguese State Budget, but the real problem is the quality of this budget. This is a budget that will create an aggravation of the economic crises and will lead to a recession, will maintain the State dreadful management practices and will protect the Government party recommendations to well remunerated public positions, preserving the incompetence in the State.

We know what taxes will rise next year and how much they will rise but we have no idea on what and where the State will cut expenses and save money, being technically based on an utopia of assumptions and forecasts for the economical activity under the effects of this budget, which will make it non-compliance practically certain. Above all this is a terrible budget because it does not reveal what is the Government Strategy to take the country out of its current situation and how to develop the Portuguese production and the economical activity. This is a Budget of “near coast navigation” instead of the vital “discovery navigation” that the country needs.

So what it should be the main lines of this budget?

First, on the State incomes item the taxes rise, as referred here in the past¹, should be made on the Personal Income Tax and not on the VAT, on the land property, alcohol, tobacco and luxury consumes. Should be reduced the level of the fiscal deductions to the PIT and increase the tax rate on the dividends distribution to stimulate the reinvestment, as it is define on the 2011 State Budget.

Second, on the Government expenditures, also as referred here in the past², the public salaries cuts should be on incomes above the 600 Euros; the immediately extinction of all the public companies and the reinstate of them in to the State when they have consecutively 3 years of negative operational results; the introduction of tolls in all motorways; stopped the launch of all State constructions that are not essential to promote the exportations or have in it an higher importation component, that means the immediately standby of the new international Lisbon airport and the TGV; the diminish of the State spending on acquisitions and supply to the strictly essential, no new cars to the public servers only to the basic services like police patrol or fire department cars; creating a spending control planning to prevent and punish all those who use unjustifiably the public resources, independently of their hierarchical position; centralise all the public servers recruitment, for local and central services, on a public recruitment agency, that already exist and is not used by the services.

Third and the most important, defining the political and economical strategy for the next 10 years, a strategy that stimulate the national growth. The Parliament with the Portuguese President and the Supreme Court of Audit must create a commission of independent economists, lawyers and accountants, independent to all parties and without government past, to supervise and ensure the respect of the Budget and to charge those who are not respecting it. The State must implement a policy of paying its suppliers within a maximum of two month, this way with no spending increase the Government allow the economy to have more financial capacity because the State suppliers do not need to apple to the banks in order to be able to respect their payments in consequence of the State be a terrible payer of its debts taking more than one year to pay them. Amplify and simplify the subsidise credit to the investments in the trade goods production and preferential if it is for the exportation market, all the exportation activity must be helped and nurtured. We must intensify the national investments, both public and private, on the extensive increase of national energy production based on renewable sources and independently of imported ones, otherwise with the looked-for global economic growth, especially of our exportation markets, the oil price will shoot up and with our heavy dependence on imported energy our exportations will lose competitiveness and the internal inflation will raise, reducing even more the internal consume. It is also a moral and efficient obligation to implement the annual evaluation of the public serves in leadership positions and charge them disciplinary and criminal for their actions and decisions when they act against the public interests, as they should be premium when they have and exceptional performance.

We have no more time to lose with self-centred politicians and with party’s interests, we need to Portugal to come on first and above all the personal ambitions of our mediocre politicians class.

1 http://portugal-mordaz.blogspot.com/2010/10/is-vat-increase-best-option.html

2 http://portugal-mordaz.blogspot.com/2010/10/black-hole-that-is-portuguese-public.html