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.