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Monaco faces Economic Challenges with a 2020 Amended Budget

The National Council recently held Public Sessions for the amending of the 2020 Budget as an essential step to release urgent funds during the current and ongoing pandemic. The funds will allow Monaco to better face the COVID-19 pandemic in the health, social and economic sectors.

National advisers were united and voted unanimously for first amending budget 2020 deficit of approximately 500 million euros. With spending up 308 million (+ 20%) and revenue down 174 million (- 11%) compared to the original budget, the forecast deficit is 477 million euros.  However, no one knows when the pandemic will be under control and expenditures could well increase even further.

Monaco releases Funds in face of COVID-19 Challenges
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Raises for frontline workers

The amending budget bill considerably modifies the 2020 budget from last December. The public session provided an overview of issues that are still the subject of discussion, including:

– A raise for nursing staff and for people who work in healthcare establishments as well as firefighters, public security agents and civil servants in the Principality.

-A 20% reduction in commercial and office rents in the private sector, for a quarter, for tenants whose activity has stopped or has been strongly impacted.

-The prohibition of unfair lay offs and allowing employees to work from home when possible during the crisis.

Currently, nearly 75 million euros has been put into direct aid per month during the pandemic: 50 million for the 22,000 employees who have CTTR and 24 million in aid to businesses and self-employed people.

Reopening the economy

A progressive reopening plan was also presented to elected officials during the meeting between the government and the National Council. A gradual lifting of containment will be decided by the Government after studying the most pragmatic way to keep the public healthy while boosting the economy.

Monaco releases Funds in face of COVID-19 Challenges
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Education

In terms of education, many parents are concerned about students returning to school while other parents are struggling with balancing work and educating their children. The delegation wants parents to have the choice of whether or not to let their children return to their educational institution. For parents who will choose to keep their children at home, national advisers asked that students continue to have the tools available to follow their courses. For students who return to school, elected officials have asked that they go to school for the whole day, so parents can return to work.

The State’s plan to combat the economic effects of COVID-19 for employees, self-employed people and businesses in the Principality will have to be constantly optimized according to the evolution of the crisis. Only time will tell how Monaco’s health and economy will recover from this ongoing crisis.

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