The Fiscal Council acquired a new modeling tool to improve the assessment of long-term sustainability of public finances

The Fiscal Council concluded a multi-year project with which we obtained a new model tool for assessing the long-term sustainability of public finances, with an emphasis on risks due to demographic changes. The project was financed by the European Commission within the Instrument of Technical Support to Member States (https://commission.europa.eu/funding-tenders/find-funding/eu-funding-programmes/technical-support-instrument/technical-support-instrument-tsi_sl ). The Danish DREAM Institute (https://dreamgroup.dk/), which has many years of experience in this field, was chosen to implement the model tool.

The project was officially completed with a workshop on 13 June 2024, where DREAM representatives presented a model to representatives of Slovenian institutions dealing with public finances (Ministry of Finance, Ministry of Labour, Family, Social Affairs and Equal Opportunities, IMAD, SORS, Bank of Slovenia, IER). Despite the official end of the project, DREAM representatives will continue to provide support to the Fiscal Council in managing the model in the future.

The new tool will improve the Fiscal Council’s ability to assess the long-term sustainability of public finances, particularly in the area of demographic change. The tool also allows simulation of the effects of different policy change scenarios.

Slovenia has committed itself to establishing the Fiscal Council by ratifying the international Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, based on which the fiscal rule was integrated into the Constitution in 2013, while in 2015 an implementing act – the Fiscal Rule Act – was adopted.

The Fiscal Council is an independent and autonomous state authority supervising the management of the fiscal policy. Its fundamental task is to monitor the compliance with the fiscal rule, the medium-term balance between revenue and expenditure without borrowing, except in exceptional circumstances, and to monitor the implementation of the EU legislation regulating the economic governance in Member States.

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