everyone, according to Minister Marterbauer, will experience the effects
In the heart of Europe, Austria is grappling with a significant budget deficit, a challenge that will be decided on a continental level in July. The previous government's handling of debt during the Covid and inflation crises has been called into question, with money seemingly being abolished, leading to irresponsible budget decisions.
The new Finance Minister, Markus Marterbauer (SPÖ), has been tasked with repairing the ailing budget. He has implemented six billion euros to address the deficit, but it is not expected to bring the deficit below three percent this year. An additional 350 million euros will be received from banks, and 200 million from energy companies.
The numbers regarding the budget deficit have worsened in the six weeks since Marterbauer took office, with the deficit projected to be 4.4%. Despite this, Marterbauer remains confident, attributing his success to presenting himself as an expert based on facts and stating his political opinion.
The EU deficit procedure will have implications for Austria. The European Commission has formally recommended initiating the procedure due to Austria exceeding the Maastricht criteria deficit limit. However, Austria and the Commission have agreed on a credible deficit reduction plan aiming to bring the deficit below the 3% threshold and continue reducing it further, indicating cooperation and a constructive approach from Austria's side.
Marterbauer finds it peculiar that he is driven around with his own Mercedes in Warsaw instead of taking the airport bus. Nevertheless, he is focused on the task at hand. In the upcoming budget speech, he will present all facts on the table, clear about the current situation and its influencing factors. There will be no sugarcoating.
The budget speech will also highlight Austria's focus on innovation and sustainability, demonstrating a broader strategy within which the fiscal discipline measures are to be implemented. Marterbauer has been praised for his job performance after initial reservations from NEOS and ÖVP. Despite the formal initiation of the deficit procedure against Austria, he remains confident, suggesting Austria does not foresee major negative consequences from the procedure.
In conclusion, the expected outcome of the EU deficit procedure for Austria is a monitored, stepwise fiscal consolidation aligned with EU rules, with Austria maintaining confidence in its economic strategy and compliance prospects.
The new Finance Minister, Markus Marterbauer, is working diligently to address Austria's significant budget deficit, implementing measures to reduce it but expecting it to exceed the three percent threshold this year. The EU deficit procedure instigated by the European Commission, due to Austria surpassing the Maastricht criteria deficit limit, could potentially impact Austria's economic standing. However, Marterbauer remains assured, promoting his strategy focused on fiscal discipline, innovation, and sustainability, demonstrating Austria's commitment to compliance with EU rules and a positive outlook for the future.
