SARAJEVO, Oct 28 (Reuters) - Bosnia expects to post a consolidated budget surplus in 2008 but will have to apply budgetary restrictions in 2009, Prime Minister Nikola Spiric said on Tuesday.
"We don't have any indication of a budget deficit this year," said Spiric. "I expect that we shall have some unspent funds in the state budget this year as well."
Spiric, the chairman of Bosnia's central cabinet, heads the fiscal council that comprises the prime ministers and finance ministers of the country's two autonomous regions, the neutral Brcko district, as well as the central bank governor.
Bosnia's two regions, the Muslim-Croat federation and the Serb Republic, have separate governments and budgets, and the central cabinet also has its own budget.
The international financial agencies, such as the International Monetary Fund (IMF), have long called for the formation of the national fiscal council to coordinate the regional fiscal policies.
The fiscal council became operational in September, when it conducted its first session.
"We will have to conduct a restrictive budgetary policy at all levels in 2009 and the budget planning will have to be done within realistic resources and take into account all fiscal plans related to 2009," Spiric said.
The Muslim-Croat federation expects a to post a budget deficit due to huge social payments originating from legislation passed as an election sweetener in 2006, which has come into force this year.
It plans to revise down its 2008 budget of 1.76 billion Bosnian marka ($1.13 billion) by at least 200 million marka to form the basis of the 2009 budget draft.
The Serb Republic government has proposed to increase the 2008 budget by 5 percent to 1.57 billion marka, and the budget for 2009 will be drafted accordingly.
The central cabinet's budget, which is fuelled by the regions and can be drafted only after they have planned their budgets, has seen some unspent funds in the past years due to restrictive law on public procurement.
Spiric said he expected a similar situation this year as well, but failed to give any figures. (Reporting by Daria Sito-Sucic)