RRZ: Next Year's Budget Realistic, But Long-term Measures Lacking

Bratislava, November 24 (TASR) - The Budgetary Responsibility Council (RRZ) expects the general government deficit to reach 5.6 percent of GDP next year, which is some 0.9 percent less than projected in a draft submitted by the Finance Ministry, RRZ chairman Jan Toth told a news conference on Thursday. Therefore, RRZ views next year's budget as realistic. However, it expects the deficits in the next few years to be deeper than those projected by the Finance Ministry, mainly due to the lack of measures taken. If no changes are adopted, RRZ estimates that the deficit will reach 4.6 percent in 2024 and 4.8 percent in 2025. It ascribes the worsening public finances to the war in Ukraine and the energy crisis, which have deepened the general government deficit by 0.7 percent of GDP over the longer term. Despite this, RRZ expects moderate growth in Slovakia's GDP, fuelled by the drawing of EU funds. "As the high deficit figure in 2023 is chiefly the result of the creation of an energy reserve amounting to €3.4 billion, it's important that these funds are used exclusively for temporary and targeted aid, while the Government should transparently justify a specific method of providing aid and the amount," stressed Toth. The long-term sustainability of public finances is in the high-risk band, mainly owing to the energy crisis. According to RRZ, Government measures themselves have improved the level of sustainability by a mere 0.1 percent of GDP, despite the adoption of a pension reform with a positive impact amounting to 1 percent of GDP. ko/df