THE BUDGET BALANCE – TECHNICAL AND FINANCIAL ASPECTS

Abstract

The paper focuses on issues related to the procedure for determining the different types of budget balance in compliance with the consolidated fiscal programme (CFP) and the national budget, and their economic interpretation. The paper also specifies that the numeric value which states the difference between the value of receipts and the value of outlays depends on the absolute sum of expenditure on interest payments on internal and external loans. The dynamics of the difference between the values of receipts and outlays under the CFP and under the national budget is analysed. We prove that the rate of change in the consolidated cash budget balance does not match the rate of change in the cash balance on the national budget. We also identify the relation between analysed balance variables and the reference values approved by the Maastricht Treaty and set in the Public Finance Act. An analysis is made of the effect which the rate of change in the nominal value of receipts and outlays exercises on the dynamics of analysed cash budget balances. Finally, we arrive at the conclusion that the value and the relative share of the budget balance in the GDP do not pose a threat to public finance stability.