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Brussels (APA) – Austria is expected to be confirmed by the EU Commission as being on track in the ongoing deficit procedure, despite anticipated higher budget deficits of the federal states. On Tuesday, the EU Commission will present the autumn part of its so-called European Semester package with economic policy recommendations to the EU member states in Strasbourg. According to information from the Commission, Austria is “on track,” although the budget gap is expected to remain deep according to forecasts.
Vienna has reported the measures to combat the deficit to Brussels on time by October 15. On Tuesday, the Commission is not expected to present a new assessment of Austria, as it has already submitted the desired plans and figures for 2025 and 2026 with the dual budget. No further requirements from Brussels are currently expected until the publication of the spring package in May or June 2026, despite the “surprise” from the figures of the federal states, according to the EU Commission.
Finance Minister confirms higher state deficits
Austrian Finance Minister Markus Marterbauer (SPÖ) recently confirmed that the total new debt of the Austrian federal states will be “significantly higher than previously expected.” He learned this from the federal states. Marterbauer is now waiting for “detailed information.”
It has been known for several weeks that the deficits, especially in federal states in the east like Vienna, are significantly exceeding the framework. The overall national deficit could rise towards 4.9 instead of the targeted 4.5 percent of GDP. Marterbauer stated that the federal states and municipalities must “make significantly more effort.” The stability pact, which regulates the borrowing possibilities of local authorities, must be submitted to the EU by the end of the year and is currently being negotiated.
EU economic forecast also expects too high deficit values
The latest EU autumn economic forecast also does not expect good values: The deficit is expected to exceed the value defined as permissible in the EU of 3.0 percent of economic output, reaching 4.4 percent this year. Next year, the deficit is projected to slightly decrease to 4.1 percent, but the following year is expected to rise again to 4.3 percent (EU average this year: 3.3 percent). Austria is not alone with the poor deficit values: In addition to Germany, Belgium, Estonia, France, Slovakia, Finland, Hungary, Poland, and Romania will also not meet the 3 percent Maastricht threshold by 2026.
The reason for the initiation of the deficit procedure was that Austria, with its budget deficit of 4.7 percent of GDP last year and the planned 4.5 percent this year, is clearly above the permitted limit of three percent of economic output according to the Maastricht criteria of the EU. The EU Commission had determined an excessive deficit for Austria in its spring package for the European Semester at the beginning of June and announced the recommendation of a procedure, which was approved by the Council of Finance Ministers in July. It is planned that Austria will exit the deficit procedure by the end of 2028. (24.11.2025)