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.