According to preliminary data, the state budget deficit for the first two months of the year totalled EUR 116 million, while in the same period last year it recorded a modest surplus (EUR 19 million). For the full year 2026, the budget deficit has been projected at EUR 2.1 billion.
In this period, revenue (excluding intervention measures) showed a year-on-year increase of 8.2%, which was much higher than in the same period last year. The growth in expenditure (excluding intervention measures) has remained high and broad-based, reaching 14.3% in the first two months of this year. The year-on-year growth in revenue and expenditure in the first two months of this year was significantly impacted by RRF funds. Without these funds, the increase in revenue and expenditure would be lower by 3 percentage points.
The state budget recorded the lowest January surplus (EUR 14 million) in recent years. Revenue increased three times slower than expenditure. The high growth in expenditure was fuelled by an increase in current spending (primarily an increase in subsidies and labour costs) resulting from economic policy measures, and transfers to budgetary funds.
Economic policy measures, particularly wage and pension reforms, also contributed to the increase in expenditure from the other three public finance budgets last year.
The increase in transfers from the state budget to social security funds highlights challenges in their self-financing.
In recent years, the volume of transfer to the health insurance budget has increased significantly. The adopted financial plan of the Health Insurance Institute of Slovenia (ZZZS) for 2026 envisages a balanced compulsory health insurance account, but is based on the extensive effects of the planned measures. If these effects do not materialise, the health insurance budget deficit could be the largest ever.
Last year, pension expenditure grew faster than nominal GDP, and its share expressed as GDP reached its highest level in five years (10.2%). The introduction of the winter allowance contributed significantly to the growth in expenditure from the pension insurance budget.
The municipal deficit fell to -0.2% of GDP in 2025. Transfer from the state budget increased again, partly due to the introduction of additional funds to reduce disparities between municipalities.
The state budget deficit, excluding intervention measures, increased significantly from EUR 0.2 billion in 2024 to EUR 1.7 billion in 2025. According to the current budget documents, the deficit is expected to further increase in 2026-2027.
The high year-end budget deficit was mainly due to economic policy measures (winter bonus and winter allowance, additional financing of health insurance budget) and was, unlike in the previous years, not due to extraordinary circumstances.
The increase in state budget revenues was slower than in the previous year. The main source of growth consisted of EU rather than of domestic funds, which were negatively affected by the deteriorating economic situation.
The state budget expenditure, excluding intervention measures, increased by 15% or five times faster than the year before. The increase was broad-based, and was principally due to the high cost of labour resulting from wage reform and winter bonus payments. Investment was up by about one fifth, one half of this increase being due to higher defence spending.
In 2024, the general government sector’s real current expenditure grew significantly higher than the estimated long-term economic growth for the second consecutive year. A similar trend is expected to continue also in the future. The high current expenditure growth poses a risk in terms of fiscal sustainability, since it is difficult to bring it down once the rights have been established. Therefore, economic policymakers should refrain from encouraging expectations of further interventions by the state.
The gross debt-to-GDP ratio slightly increased by the end of the third quarter last year and was at level similar to the pre-COVID-19 level. Slovenia is ranked in top half of EU Member States (10th out of 27) in terms of the debt-to-GDP ratio. A high liquidity reserve remains an important risk mitigating factor.
The state budget deficit, excluding intervention measures, was around EUR 1 billion in the first eleven months of this year. This is approximately half of the projected full-year deficit (EUR 1.8 billion), also excluding intervention measures.
The projected December deficit (EUR 852 million) is one of the highest to date. Only in December 2023 was deficit at a similar level (EUR 823 million). According to the Ministry of Finance’s outturn estimate, the estimated high December deficit will be mostly due to the roughly four times greater year-on-year growth in “core” expenditure than the average in the first eleven months. This growth will be mainly driven by expected higher expenditure on labour costs (winter bonus), investments, subsidies and transfer to the Health Insurance Institute of Slovenia.
Like the Fiscal Council, the European Commission has also assessed that the net expenditure growth in 2025 substantially exceeds the growth set out in the Medium-Term Fiscal and Structural Plan. The estimate for 2026 is similar. Consequently, the European Commission warned the Government that there is an increasing risk of incompliance with the allowed total growth in net expenditure in the period covered by the Plan. The Commission called on the Government to adopt measures to ensure the compliance of fiscal policy with the Plan and maintain the medium-term sustainability of public finances.
The Fiscal Council was invited to the 68th emergency session of the Committee of Finance held on 10 November 2025 to discuss the agenda item entitled: Draft Winter Bonus Payment Act and Revision of the determination of the tax base using standardised expenditure.
On 6 November 2025, the Fiscal Council hosted a delegation of the International Monetary Fund (IMF) within its regular annual consultation mission in Slovenia.
The purpose of the visit was to review fiscal developments and projections, to assess fiscal policy, and to exchange views on Slovenia’s future fiscal challenges.