The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
This Selected Issues paper examines the need of reformation of the Fiscal Responsibility Act (FRA) in the Slovakia. It is suggested that in light of experience gathered so far, FRA modifications should be considered. Clear guidelines regarding a cost-effective cash management strategy should be established. Debt brake level should be kept at the current limits, rather than lowered over time, to avoid unduly eroding fiscal space. Policies should aim to maintain a safe margin below debt thresholds to allow fiscal policy to play a counter-cyclical role in the future during downturns. Adjustment measures should be more gradual and the bias toward spending cuts should be lessened or removed.