Austria's budget debacle: Shocking deficits of 4.7%!

Austria's budget debacle: Shocking deficits of 4.7%!

The financial situation in Austria ensures considerable concern. According to the current figures of Statistics Austria there is a deficit of the gross domestic product (GDP) for 2024. came across a broad public and political reaction.

WIFO director Gabriel Felbermayr described the deficit points as "shocking" and warned of possible consequences in the form of an EU deficit procedure. Finance Minister Markus Marterbauer (SPÖ) agreed and described the starting position as serious, and the already planned savings of 6.4 billion euros were a "massive effort". He sees no way to reach the Maastricht limit of three percent at short notice without endangering economic stability.

rising government spending and high debts

The deficit results, among other things, from a weak economy and an increase in government spending by 8.8 percent. These rose by a total of 21.8 billion euros, while the income rose only by 11.7 billion euros (4.9 percent). The income from taxes and social contributions made 86.8 percent of the total tax revenue of around 216 billion euros, which corresponds to an increase of 5.4 percent compared to 2023, such as reported.

In addition, an alarming developments in public debt, which was around 394.1 billion euros at the end of December 2024. The debt rate has increased to 81.8 percent, with Austria still under pressure compared to other EU countries. On average, the EU countries have a lower debt rate, Fest.

The governors were stubborn in terms of higher contributions to the budget renovation and emphasize that they already suffer from a poor financial situation. Tyrol's governor Anton Mattle referred to the low debt of his federal state and spoke out against an EU deficit procedure. In another light, Upper Austria's Governor Thomas Stelzer brought a debt brake into the federal government.

The Court of Auditors puts further pressure: President Margit Kraker demands a convincing reform plan for public finances to address the challenges. The dramatic financial situation requires immediate action to get the continued deficits under control.