The President Vetoed the Relaxation of Fiscal Responsibility Rules

The amendment to the Act on Budgetary Responsibility and Related Regulations was intended to allow the government to exceed approved state budget expenditures by up to 10 percent in the event of a deterioration in the security situation. Given the current budget size, this would amount to approximately 240 billion crowns. The bill also provided for an extension of the exemption for increased defense spending through 2036 and a similar relaxation of funding restrictions for strategic infrastructure. In his justification for the veto, the president stated that the state must be able to finance defense, infrastructure, and other priorities, but while maintaining clear rules, democratic oversight, and accountability to future generations.

Government officials have criticized the veto, arguing that without changing the rules, it will not be possible to fund defense, healthcare, energy, or major investments. Finance Minister Alena Schillerová stated that, according to the government, there is no alternative to changing the budget rules and that the amendment itself does not automatically increase the deficit. However, the president’s reservations have also been supported by a group of economists, who called on lawmakers to objectively address the risks of loosening the rules. According to them, the most problematic aspects are the possibility of increasing spending by 10 percent based on a decision by the State Security Council and the expansion of exceptions to budgetary frameworks. The Chamber of Deputies can override the presidential veto with a simple majority of all members; the coalition of ANO, SPD, and Motorists has 108 votes.