Marterbauer: Consolidating public finances. Do the right thing. Providing confidence. Finance Minister Markus Marterbauer presents the 2025/2026 double budget
With its 2025/2026 double budget, the Federal Government is presenting a large number of consolidation measures on the revenue and expenditure side, which will amount to a consolidation volume of 6.4 billion euros this year and as much as 8.7 billion euros in 2026.
‘We are restructuring the budget for two reasons: firstly, we want to avoid high interest payments and dependence on the financial markets. Secondly, we want to create scope for progressive investment. I would rather invest the money in schools, railways and hospitals than pay billions in interest,’ said Finance Minister Markus Marterbauer at today's presentation of the budget in parliament.
The Federal Government is united in its willingness to take responsibility and consolidate the national budget. "It is a joint effort. Cooperation, this “togetherness”, has always been impressively successful in Austria, even in the many crises of the past. This is the basis for our country's enormous economic and social success,‘ says Finance Minister Markus Marterbauer, who is confident that the economic recovery will succeed. ’Austria can do it if it wants to.‘
To ensure the success of the budget consolidation, efforts were made to distribute the burden as fairly as possible. “Everyone will be affected, but we must succeed in convincing the population of the necessity and the meaningfulness of this budget consolidation. I firmly believe that citizens are willing to contribute to balancing the budget —
provided they can be sure that everyone is doing their part. Provided they can be sure that the burdens of consolidation are distributed fairly among social groups and economic actors.” When it is clear that those who have more also contribute more. That has been our aim over the past few weeks. And it is an essential prerequisite for the political success of the consolidation.
Budget consolidation based on facts and scientific findings – ‘Transparency is becoming the new favourite colour of budget policy,’ says Marterbauer
Last year, the general government deficit amounted to 22.5 billion euros or 4.7% of GDP. Without consolidation measures, the deficit for this year would have risen to more than 28.6 billion euros or 5.8% of GDP.
With the double budget, the deficit will fall in 2025 and 2026, initially to 4.5% and then to 4.2% of GDP. The current consolidation package, amounting to 1.3% and 1.7% of GDP, will make a significant contribution to this.
During this legislative period, the total government revenue ratio will initially rise from 51.6% of GDP in 2024 to 52.3%, and then remain constant until 2029.
The tax and contribution ratio will initially rise from 44.5% to 45.5% and remain stable at this level. Higher government revenues will make an indispensable contribution to the reorganisation in the short term.
Among other things, banks and energy companies will make a contribution and tax loopholes will be closed. The tax measures will amount to 1 billion euros in 2025 and 2.2 billion euros in the coming year. In addition, each portfolio has made a contribution to administrative savings, which will total 1.1 billion euros in 2025 and 1.3 billion euros in the coming year. With the abolition of the climate bonus and the resizing of subsidies, these items will contribute to reorganisation measures amounting to 3.3 billion in 2025 and 2026. The remaining measures concern the labour market, employment of older people and pensions, as well as dividends from state-owned companies and contributions from other sectors.
In the medium term, government spending will play a major role. The expenditure ratio will fall from 56.8% of GDP in 2025 to 55.0% in 2029. This is despite an increase in interest expenditure as a percentage of GDP from 1.5% to 2.4%. Among other things, the climate bonus will be abolished. Subsidies will be scaled back. Structural reforms are also expected to have a positive long-term impact on the budget.
In addition to savings, investments in labour, social affairs and education are planned
In addition to numerous savings, proactive measures are also planned in the 2025/2026 double budget.
In the economy and labour sector, tax breaks for small and medium-sized enterprises are planned, along with a higher subsidy budget for the AMS, a new model for continuing education and the introduction of an attractive ‘working in old age’ model. This year, 477 million euros are earmarked for offensive measures in the labour and economy sector, with 977 million euros planned for 2026.
In the health and social sector, prescription charges will be frozen and a maintenance guarantee fund will be set up to help in cases of hardship where maintenance payments are not made. In addition, an innovation fund will be set up to strengthen outpatient care. 16 million euros have been earmarked for these measures this year, rising to 235 million euros in 2026.
The Federal Government is providing an additional 120 million euros for education and integration this year and 350 million euros in 2026. Among other things, there are plans to expand German language support, make a second year of kindergarten compulsory, provide additional funds as part of the opportunity bonus and give young people free access to reliable journalistic information.
Information on the budget is also available in interactive form on the website budget.gv.at.