PRAGUE, Jan 30 (Reuters) - The Czech central state budget deficit could be below 280 billion crowns ($12.75 billion) this year, as planned spending cuts combine with higher expected revenues, Finance Minister Zbynek Stanjura said on Sunday.
The centre-right government, in office since mid-December, has vowed to cut this year's deficit to below 300 billion crowns from 377 billion-crown gap planned by the previous cabinet. Last year's budget deficit was 419.7 billion crowns, a record.
Stanjura said that besides spending cuts planned at 80 billion crowns, roughly a half of 60 billion-crown in extra budget revenue, brought by faster inflation, could be used to cut the deficit. The other extra revenues would be allocated to hikes in pensions forced by rising living costs.
However, the government's savings plan might prove hard to achieve as most of the spending is mandatory or semi-mandatory by law.
The government is also looking for ways to help households hit by soaring energy prices.
Without an approved budget, the country entered 2022 forcing the state to operate within a provisional budget framework based on the 2021 budget. This limits non-essential spending like investments.
Stanjura reiterated the government's pledge to have a proper budget in place by the end of March.
The record deficit recorded in 2021 added to fast-rising debt load that the five-party government has pledged to tackle.
Although the debt load, forecast to hit 42% of GDP in 2021, is still well below most European Union peers, the rate of its growth is forecast in the coming years to be one of the fastest in the bloc - seen surpassing 50% in 2024.
($1 = 21.9620 Czech crowns) (Reporting by Robert Muller Editing by Frances Kerry)
