National Bank: The government's austerity package is not enough

Due to the persistently poor economic situation, the current austerity plans are not enough. Should the government step up on the brakes even more? Or accept a higher deficit without a fight?

After a budget deficit of four percent in 2024, the new government's austerity package should actually push this figure below the Maastricht threshold of three percent this year. However, the new OeNB forecast shows nothing of this.

Politicians came up with even more measures to save money.

With the draft budget of the CDU-SPD minority government presented on Monday, it is now clear where the individual ministries want to spend money. At any rate, four billion euros have to be saved.

Despite the Federal Government's austerity efforts, the deficit is not expected to fall below the Maastricht threshold of 3% this year. The National Bank expects a deficit of 3.8 percent in 2025, and only in 2027 does it see a rapprochement with the 3% limit. However, the government does not want to adopt any further measures because of feared negative economic effects. Federal President Alexander Van der Bellen sees [...]

Government sources tell IS that the government is currently in a heated debate over the controversial social and health care savings. The Finns Party is having a particularly difficult time.