At Budget Hearing, Criticism Looms

When the budget committee meets for the traditional budget hearing on Tuesday, it is already clear in advance that the invited experts will not hold back with criticism. All the experts presented by the parties have already viewed the government's budget draft more or less critically after its presentation. The unanimous expert opinion is that the current measures will probably not be sufficient in the long term.

According to the draft by Finance Minister Markus Marterbauer (SPÖ), the budget deficit is expected to decrease from 4.7 to 4.5 percent of GDP this year. Next year, it is expected to be 4.2 percent. Both values are well above the EU's allowed value of three percent, which is why a deficit procedure by Brussels is likely to be initiated before the summer. To avoid an even higher deficit and to be able to implement offensive measures, seven billion euros will be saved this year and even 10.3 billion euros in 2026. The biggest chunk is the abolition of the climate bonus, and subsidies will also be significantly reduced.

Budget Hearing with Badelt and Schratzenstaller

The ÖVP has invited probably the most prominent economist to the budget hearing. With Christoph Badelt, the head of the Fiscal Council will be available to the members of parliament on Wednesday. He does not fully share the government's optimism regarding the need for consolidation. If the goal is to actually get back under three percent deficit by 2028, "many more sharp and unpleasant political decisions will be needed," he recently stated in the "Oberösterreichische Nachrichten". He desires further reforms in pensions and health, and savings could also be made in climate-damaging subsidies.

Wifo expert Margit Schratzenstaller, who is attending the hearing at the invitation of the Greens, sees the fact that the latter is not being done, but that climate measures are being heavily cut, as a "bitter pill". Overall, she has so far tended to view the budget positively. Schratzenstaller considered it "reasonable" in an interview with APA that the main focus is on the expenditure side, but that revenues are also being increased, especially for short-term consolidation.

NEOS Expert Sees No Major Breakthrough

Monika Köppl-Turyna from Eco Austria did not react very enthusiastically to the budget proposal. She was called upon as an expert by the NEOS. Köppl-Turyna cannot see a major breakthrough in the absence of structural reforms, such as in pensions, and warns that the tax rate and debt continue to rise. Like Badelt, she considers the consolidation path unrealistic. If one wants to create leeway again from 2028, an additional five billion would have to be saved by then, she recently stated in the "Kleine Zeitung".

Similar criticism comes from Martin Gundinger of the Austrian Economics Center, who was proposed by the FPÖ for the hearing. He criticizes excessive government spending, especially in the social sector, as well as excessive debt.

Even the SPÖ, whose finance minister presented the budget, nominated an expert who is not uncritical of the budget draft. Georg Feigl, who comes from the same Chamber of Labor department as Marterbauer, criticized that too little was demanded from the wealthy. As a result, there are now too many cuts with negative impacts. Feigl considers the contribution of low incomes to the savings package to be too large.

Further Steps

After the budget hearing, the budget draft will first be reviewed chapter by chapter in the Budget Committee before it goes to the plenary. There, debates will begin on June 16, with the budget accompanying law being passed first, followed by the individual areas. The adoption of the double budget is scheduled for June 18.

(APA/Red)

This article has been automatically translated, read the original article here.