Im Budget committee Today the MPs discussed the current budget development with fiscal council president Christoph Badelt and finance minister Markus Marterbauer. So far, the Federal Government has sought a consolidation volume of 6.3 billion ꞓ for 2025 and 8.7 billion ꞓ for 2026. Badelt emphasized, “today we know that the business forecasts are significantly deteriorating.” Based on the deterioration of the economic situation, the fiscal council expects the Maastricht deficit limit of 3 % 2025 to be reached. According to Badelt, this is expected to be well over 3 %, probably also over 3.5 %. “It could also be that the deficit approaches the 4 % more,” he speculated. The countries and municipalities should be observed, because their contribution to the budget is uncertain. Despite the decided budget renovation measures, the deficit will be between 3.5 % and 4 % of GDP, Finance Minister Markus Marterbauer also explained. In order to counteract this, it would need another consolidation package to the extent of what has already been decided. However, the finance minister warned of this. “If we keep this effect, the economy will continue to be steamed and we have a vicious circle,” Marterbauer told the MPs.
The announcement of the new government in early March brought about changes to the departments, which has already been shown in a recently decided amendment to the Federal Minister law. Since these shifts in competence also have to be reflected in budget law, Andreas Hanger (ÖVP), Kai Jan Krainer (SPÖ) and Karin Doppelbauer (NEOS) have brought in a corresponding application for law (123/A), which was largely accepted in the budget committee today.
Badelt: Political decision whether to continue consolidated
The starting point of the discussion was the report on public finances 2023 to 2028, which the fiscal council published in December 2024 (III-117 d.B.). In the report, the fiscal council expects an increase in debt ratio to 85 % by 2028. The expert: Inside, under the no-policy change premise of rising budget deficits in 2024 and 2025 in the amount of 3.9 % and 4.1 % of the gross domestic product (GDP). By 2028, the fiscal council expects an economic recovery and a slight decline in budget deficit to 3.5 % of GDP. The report was in the Budget Committee Enderdedigt.
As the next official step, Badelt expects the WIFO business forecast and the first ex-post figures for the federal states. As a decisive point, he named the European Commission’s business forecast in May, on the basis of which the Commission of Austria re -evaluated.
Badelt agreed with the MPs in the fact that the municipalities had the task of making important investments, especially in the areas of general interest and environmental protection. Nevertheless, everyone would have to save, including the municipalities, emphasized the fiscal council boss. As far as the planned cuts of the factual expenditure in the ministries are concerned, he pointed out that this was only a very specific partial aspect. In addition, one probably does not want to shorten in departments, where there is a high level of material effort (e.g. justice, military, police). According to Badelt, it is more difficult for the opinion that after the budget speech, almost only half a year will remain to implement all the measures.
Marterbauer warns of the vicious cycle
Finance Minister Markus Marterbauer dealt with the close connection between the economy and budget deficit. The deficit development depends on the overall economic development, he emphasized. Discretionary measures have an impact on the economy. According to Marterbauer, it is important to consider which measures have which cushioning effects have. The measures adopted such as banking, energy crisis contribution and the abolition of sales tax exemption for photovoltaic systems would have low or no effect on the economy, he said.
Marterbauer also emphasized the importance of investing in the communities, since they would have a direct impact on the citizens: inside. Nevertheless, additional support from the municipalities is currently not possible due to the difficult budget situation, he regretted. In general, however, he appreciates economic development a little more optimistic than the WIFO. He thinks that the recently decided infrastructure package in Germany will also have a clear economic impulse in Austria.
We know a lot about the federal budget, but little about countries and communities, so he has contact with the state financial officer: included in the inside, said Marterbauer. Several federal states would therefore expect high deficits. These would be in the amount of the past few years or above. In addition, the financial situation of social security has deteriorated, according to the finance minister. This is due to employment development. The overall state is relevant for Brussels, so consolidation could only be a joint project. The aim is to get below the 3 %limit as quickly as possible. It requires a credible consolidation strategy. “Austria has to demonstrate that we want to significantly reduce the deficit,” said Marterbauer.
As part of a possible deficit procedure, Marterbauer does not expect a risk surcharge on interest rates as long as it is credibly demonstrated that this is dismantled. Even with a deficit procedure, all decisions are still “in our hands,” said Marterbauer. The only thing to do is to coordinate with Brussels, emphasized the finance minister. The Federal Government “does not lean back” and is working on the draft for the double budget every day, the finance minister assured. It is clear to him that each ministry had to make a contribution to save a total of 6.4 billion ꞓ. For this purpose, a distribution key is developed on the basis of objective criteria.
NEOS: A savings package will not be enough
The savings package of 6.39 billion ꞓ will not be enough, emphasized Karin Doppelbauer (NEOS). From Badelt, she questioned further measures for budget consolidation and spoke in favor of a consolidation contribution from the federal states and municipalities. Budget consolidation must affect all regional bodies together, Badelt went hand in hand. The fiscal council has published a list of potential measures, said Badelt. It is important to make a political decision.
SPÖ: Further saving measures would be economic damping
Kai Jan Krainer (SPÖ) summarized the question of whether it should be saved twice instead of 6.4 billion ꞓ. A deficit of 4 %, the third year in recession and no financial scope, is the initial situation of the federal government. Further saving measures would have a steam -damping effect, BARBARA TAUER (SPÖ) and questioned the effects of a deficit procedure. As a fiscal council leader, it is his job to ask the government, to comply with the fiscal rules and not to voluntarily engage with a deficit procedure, emphasized Badelt. However, it is clear that every consolidation has an inhibiting growth. Consolidations within the framework of up to one percent of GDP have negative effects on the economy.
Wolfgang Kocevar (SPÖ) drew attention to the situation of the communities. Municipalities are employers and would have to keep local companies alive. He recalled the general compulsory schooling and thus necessary investments in the infrastructure.
ÖVP: Trust as the top premise
The federal deficit is only part of the Maastricht deficit, explained Andreas Hanger (ÖVP). In this context, there must also be talk about countries, municipalities and social security institutions. He called for a serious debate based on a clean data situation. Hangers emphasized that the countries were also asked to consolidate. It would require all regional bodies, he underlined.
Badelt stated: “Structural changes must be made.” To consolidate the budget, zero-based budgeting is required. To do this, it must be checked in every output category whether this is necessary.
The most important thing is the question of credibility and resilience to the European Commission and the capital markets, emphasized Andreas Otenschläger (ÖVP). The top premise is trust. It is not only about the short -term measures, much more is also relevant to the medium -term perspective. Although he is not a friend of a deficit procedure, it was important to present a credible budget path.
FPÖ: “Counter now”
From Hubert Fuchs (FPÖ), it is the right approach to “save massively more”. Instead of waiting for forecasts, negotiations should be conducted. Instead of a deficit procedure, he asked the federal government to think about how more could be saved. Arnold Schiefer (FPÖ) insisted not to leave yourself too long to consolidate. Rather, it requires permanent countermeasures. If Austria is too long for consolidation, be it not prepared for future situations, he warned. In this sense, he demanded a second savings package. Badelt stated to the FPÖ: “It seems quite dangerous to continue consolidating.”
Slow back will pay more than a rapid debt reduction, emphasized Arnold Schiefer (FPÖ) and also warned of negative effects on the investments. It was important to get out of a deficit procedure as soon as possible, argued slate. Maximilian Linder (FPÖ) emphasized that in the past, the municipalities have contributed positively to the Maastricht deficit across Austria.
Greens: “The bitterest would be to further choke the economy”
In view of the descriptions that would not bring much hope for preventing a deficit procedure, Jakob Schwarz (Greens) felt soothing that such a disaster would be. “The bitterest would be to further choke the economy,” argued Schwarz, and thought it made sense to maintain and strengthen the economy. It is important not to hang up a backpack for future generations. In this sense, he demanded sustainable business. Instead of saving in climate protection, Schwarz spoke in favor of starting with climate -damaging subsidies. Together with Elisabeth Götze (Greens), he campaigned for a strong database on household income in order to be able to take good measures.
New distribution of department is also to be implemented at the level of budget law
Andreas Hanger (ÖVP) asked for understanding that the concrete design of the law, i.e. the grouping in the personnel plan, requires a precise coordination within his parliamentary group. Kai Jan Krainer (SPÖ) therefore announced the submission of an amendment application at the upcoming meeting of the National Council.
The necessary adjustments in the Federal Finance Act 2024, which must be carried out during the validity of the statutory budget provisory in 2025, as well as in the Federal Finance Framework Act 2024 to 2027 should then come into force on April 1, 2025. (Conclusion Budget Committee) GLA/SUE
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