Statement of the Spokesperson of the Ministry of Finance on the occasion of decreasing and calculating January salaries

Reduction of salaries to public administration employees and budgetary users as of 1st January 2010, was aimed at stabilizing public finance and, above all, establishing regular and full liquidity of the State Treasury and the normal functioning of the budgetary spending units of Montenegro. Although this was a painful and unpopular decision of the Government of Montenegro, which most of the countries opted for much earlier, it was brought after exhausting all measures in order to stabilize public finances and reduce public spending and adjusting the state in the economy. In this way we ensure that qualitative liquidity management and timely payment of pensions, salaries and social benefits to our users. It is worth mentioning that January salary was paid to all budgetary users up to 5th February, and December pensions were paid in a timely prescribed manner. A number of trade union organizations are alleging the reduction of salaries and changes to the tax rate personal income and contributions for compulsory social insurance, thus is should be clarified that the average reduction of January salaries of the state administration amounted to 6.5%, and about 3.5% decrease for employees in education, health and universities, following the increase in the coefficient on the basis of the implementation of the branch collective agreement. In accordance with Article 12, of the Budget Law for 2010 all payroll departments of our spending units were required to apply these rates, and to calculate the minimum wage for employees in the amount of 33% of the average salary from the previous year, according to the data of the Statistical Bureau, or 152.79 Euros. If it was determined that the calculation is less than the minimum wage, each spending unit was required to provide the missing amount up to the minimum wage amount, which means that January salary could not be lower than 152, 79 Euros. Moreover, we defined in the Budget Law for 2010 that employees receiving salary from the budget of Montenegro, and whose reduction in salary is in the percentage higher than 3.5% and whose earnings are between 33% and 50% of the average salary in previous year based on the data of the Statistical Bureau, will receive 30 Euros on a quarterly basis, subsidizing the reduction in earnings. We are reminding that if payroll departments failed to make the calculation of January salaries in accordance with the Law on Income Tax of Physical Persons and the Law on Compulsory Social Insurance will be obligated to remedy errorous calculations made in calculation process pursuant to the aforementioned laws and to compensate employees with unpaid amounts.