According to preliminary data, the state budget deficit for the first ten months of the year amounted to EUR 553 million, which was around half of the deficit in the same period last year. According to the latest available estimate by the Ministry of Finance, the end-of-year deficit is expected to amount to EUR 1,407 million, making the deficit in the last two months EUR 854.
Excluding the direct effect of the intervention measures, the deficit amounted to EUR 109 million, compared to a surplus of 96 EUR million in the same period last year. Total expenditure on intervention measures amounted to EUR 444 million, around two-thirds lower than in the same period last year. According to the latest available estimate by the Ministry of Finance, this year, EUR 713 million is earmarked for intervention measures (excluding the Reconstruction Fund).
The growth in “core” expenditure (excluding intervention measures) was 10.3% and strengthened compared to the same period last year (8.0%). The main reasons for this year’s growth were the transfer to the Pension and Disability Insurance Institute of Slovenia (ZPIZ) due to the high regular pension indexation and the high growth in payments to budgetary funds, in particular due to the establishment of the Reconstruction Fund.
The Fiscal Council, as part of its tasks under the Fiscal Rule Act, regularly warns of risks to medium-term fiscal sustainability. Such risks are also posed by the proposed Act Determining Intervention Measures for the Provision of Heat Supply in the Šalek Valley, which is not included in the regular budget documents. We assess that its fiscal implications will reduce the fiscal policy’s room for manoeuvre, that the proposed Act does not adequately present all possible solutions, and that it could also raise expectations for government action in other areas.