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Austria's financial crisis: Badelt warns of dramatic debts!
In the leadersnet interview, fiscal council president Christoph Badelt analyzes Austrian budget policy and necessary reforms.
Austria's financial crisis: Badelt warns of dramatic debts!
Austria is facing a financial crisis! Renowned experts such as Christoph Badelt, the president of the fiscal council, predict that public debt will increase to alarming 85 percent of gross domestic product (GDP) by 2028. In an interview with Leadersnet, Badelt emphasizes that urgent budget consolidation is necessary to set the financial course for a stable future. These dark prospects are also reflected in the current report of the fiscal council, which predicts high budget deficits of 3.9 and 4.1 percent of GDP for 2023 and 2024, while government spending is rapidly increasing due to inflation. The pressure on public finances increases in view of a weakening economy, which further tightens the already critical situation.
In view of this dramatic development, the need for consolidation is enormous, as the fiscal council warns. "In order to avoid negative EU deficit proceedings, measures of at least 6.3 billion euros are necessary," said Badelt, who underlines the need to deploy from traditional approaches to financial policy. It is crucial to open up both savings and new sources of income. "We have to structurally renovate the expenditure, while at the same time we are examining new opportunities for increasing income," said Badelt in an interview with ORF.urgent reforms required
"The public sector is in a precarious location", pushes Badelt and refers to the great need for action in various areas such as education and health. Measures against the shortage of skilled workers and an increase in the age of pension are also required to raise efficiency potential and to alleviate pressure on state budgets. "Without a clear plan, how existing expenses can be checked and, if necessary, reduced, it will be difficult to stabilize the budget situation," warns Badelt.
The negative effects of high inflation could reverse the positive contribution of VAT income from 2024, and GDP growth is expected to be sufficient to reduce the debt rate. The increasing demand for living space as a result of population growth has also further tightened the situation on the housing market. The debate about the efficient use of resources and the creation of scope for future -oriented investments is therefore inevitable. The need for a sustainable budget policy is bitter reality for Austria, and the way to financial stability remains rocky and challenging, as both Leadersnet and ORF report.