In the first three months of this year, the state budget had a deficit (EUR 324 million). Excluding the direct impact of expenditure on anti-COVID measures (EUR 58 million) and anti-inflationary measures (EUR 237 million), the deficit was EUR 30 million.
Based on the latest available information, we estimate that the state budget expenditure on anti inflationary measures will amount to around EUR 800 million in 2023 as a whole, around EUR 500 million less than foreseen when the 2023 budget amendments were prepared in autumn last year. At the start of drafting the revised budget, the Government announced that this is the principal reason why total expenditure this year would be around EUR 600 million lower than planned.
In line with the legislative deadlines, we expect the Government to adopt the draft Stability Programme containing four-year projections for the general government sector as a whole (for the period 2023–2026) by 10 April, while the draft revised state budget (for 2023), which represents the bulk of the general government sector, is not expected to be considered until 20 April. Key budget documents should be aligned in terms both of timeline of drafting and content. This is particularly important in the context of the announced changes to the EU’s economic governance system, where credible medium-term planning is set to become the cornerstone for assessing fiscal sustainability.