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.
The state budget deficit, excluding intervention measures, was around EUR 900 million in the first ten months of this year. This is approximately half of the Ministry of Finance’s projected full-year deficit.
The increase in the deficit this year is entirely due to higher current expenditure. The increase in expenditure is broad-based, and as expected with the largest contributions coming from higher labour costs following changes to the public sector salary system. Meanwhile, revenue growth is significantly lower than last year. This is partly due to a slowdown in economic activity and partly due to a further decline in revenue from EU funds. Intervention measures have had a negligible impact on the overall state budget balance this year, as flood recovery measures are predominantly financed from dedicated sources.
The planned winter bonus will further contribute to the deterioration of the fiscal situation this year and in the coming years. When the budget documents were assessed, we have not included the impact of the winter bonus in the general government balance projections, where, the deficit is already expected to increase, even without the winter bonus, primarily due to the significantly underestimated effect of the salary reform. The bonus will put permanent pressure on public finances, introducing it would increase the general government deficit by around 0.3 percentage points of GDP in the medium term. This increase would bring the deficit close to 3% of GDP, effectively eliminating the fiscal manoeuvring space to address the consequences of potential future shocks, which are becoming increasingly frequent.
The fiscal policy is deviating from the trajectory outlined in the Medium-Term Fiscal and Structural Plan for the 2025–2028 period. Despite Slovenia’s commitment to gradual consolidation, the state of public finances began to deteriorate already in 2025. According to the Fiscal Council’s projection, the general government deficit will increase further, reaching approximately 2.5% of GDP by 2028. The primary factor driving this deterioration is the change in the public sector salary system and the resulting growth in current expenditure, which will exceed projected economic growth. Such developments call for measures to address fiscal risks and ensure public finance sustainability. The budget documents, however, do not contain such measures, and without timely intervention, more severe adjustments will be required in the coming years.
The state budget deficit, excluding intervention measures, amounted to just under EUR 1.0 billion in the first nine months of the year, compared to an almost balanced budget in the same period last year. An increase in the deficit had been projected both in the current budget and in the revised estimate presented alongside the draft budget documents. The deficit excluding intervention measures is expected to total around EUR 1.8 billion for the entire year, compared to around EUR 0.2 billion last year. However, based on the outturn for the first nine months of the year, the full-year deficit could be lower than the current estimate, which serves as the basis for budget planning for the coming years.
The increase in the deficit this year is entirely due to higher current expenditure. As expected, the increase in expenditure is broad-based, with the largest contributions coming from higher labour costs following changes to the public sector salary system. Meanwhile, revenue growth has stalled, which was partly due to a slowdown in economic activity as well as a further decline in revenue from EU funds. Intervention measures have had a negligible impact on the overall state budget balance this year, as flood recovery measures are predominantly financed from dedicated sources.
On 30 September, the Fiscal Council received the proposed amendments to the 2026 state budget and the 2027 draft budget. In accordance with the provisions of the Fiscal Rule Act, the Fiscal Council will provide its assessment within ten days of receiving the general government revenue and expenditure projections, which are expected by 10 October 2025 at the latest.