Chairman of the Budget Council and former IHS boss Christoph Badelt analyzes the dramatic situation of the domestic budget in an interview with krone.tv. Experts currently assume a budget gap of 3.5 percent.
However, economist Badelt increases this already poor forecast value even further: “In our current forecast, which we are still working on but which we will publish in a few days, the value will even be greater than 3.5 percent. And due to the poor economic forecasts for the coming year, the budget deficit will increase further in 2025.”
It should already be approaching four percent. This is much more than the Maastricht EU criteria allow. The future federal government must therefore now take the path of strict fiscal consolidation: “The EU has given Austria a clear path: two and a half billion euros per year is the minimum that must now be saved every year. But the savings are not just about what Brussels tells us. Because we ourselves are dealing with major reform issues. For example, with pension issues and with health and care.”
Increase the retirement age
“There must be a double budget for 2025/2026, in which all necessary reform measures in the areas of pensions, health and care are visible. However, care must be taken to ensure that austerity does not further suppress growth.” For example, when it comes to pensions, consideration should be given to raising the retirement age.
Badelt: “It won’t happen immediately, but in the medium term. Because we are getting older.” Raising the starting age would therefore be useful and necessary for the economist. For example, in several steps to the age of 67, even if the increase would not be realized and completed for years. The pension problem will increase further in the coming years due to the demographic situation, but from 2030 and 2031 the increase will be smaller.
Problem Germany
A major problem for the weak domestic economic growth is the very subdued economic situation in Germany: “This is partly responsible for the fact that Austrian industry is currently seriously weakening. Because we are dependent on the German situation.” Ultimately, what matters is that we lose the pessimistic mood about consumption: “We are currently experiencing a kind of precautionary saving. Above all, healthy optimism is essential for the economy.”
In Austria, much more money should be spent on future investments in the future. And also for the education sector: “We need more investment in education. This is an investment in the future. But I am skeptical about new taxes.”
You can watch the entire interview in the video above.
We explain what Austria is currently dealing with: the latest news conversations with politicians and experts.
Source: Krone
I am Ida Scott, a journalist and content author with a passion for uncovering the truth. I have been writing professionally for Today Times Live since 2020 and specialize in political news. My career began when I was just 17; I had already developed a knack for research and an eye for detail which made me stand out from my peers.
