Ailing state budget

After 145 days: Black-Red must deliver urgently

From the left: SPÖ leader Andreas Babler and ÖVP leader Christian Stocker

(Bild: Krone KREATIV, APA)

The ÖVP and SPÖ are on the verge of a breakthrough. The ailing state budget is to be restructured with a mix of revenue and savings.

The black-red government is taking shape. The first details of the budget restructuring have been leaked. According to these, 6.4 billion euros will be saved this year and 8.4 billion in 2026. The aim is to continue to avoid an EU deficit procedure. But there are also plans on the revenue side. The bank levy is to be temporarily increased from the current 150 million by 350 million to 500 million. The expired excess profits tax for domestic energy companies is to be extended and 200 million is to be added to the coffers. In addition, the contribution to health insurance for pensioners is to rise from 5.1 to six percent.

Mix of savings and additional income
New regulations for the sale of newly dedicated properties and private foundations are also set to bring in money. The real estate transfer tax is also to be adjusted. Although the climate bonus is to be abolished, as already planned by the blue-black coalition, there is to be some compensation, for example through measures for commuters. The same applies to educational leave: although this will be abolished, it will be succeeded by a regulation with stricter access requirements. The top tax rate of 55% for incomes of one million euros or more, which is due to expire in 2025, is to be extended. The prescription fee is to be frozen. Measures planned by the blue-black coalition, such as savings in the ministries, cuts to subsidies and an increase in the digital tax, are to remain.

The road to government is long.

(Bild: Krone KREATIV/stock.adobe.com)

Federal President to be informed of progress
As soon as there is a breakthrough, the black-red leaders of the "mayoral coalition" of Christian Stocker and Andreas Babler want to inform Federal President Alexander Van der Bellen about the state of affairs. However, it could still take a while before the inauguration. This is because talks still need to be held with the opposition parties to determine whether a third partner should be included in order to secure the majority of just one vote in the National Council or how cooperation could be structured in other ways, particularly with the NEOS and the Greens. In addition, the ÖVP and SPÖ still have a lot to deliver in terms of content.

The role of the NEOS and the Greens is still unclear.

(Bild: Krone KREATIV/APA)

Business and industry urgently need impetus. The IV has called for an emergency package in the "Krone". The additional revenue is to be used to finance a number of offensive measures to stimulate the economy. A lump sum for small and medium-sized companies is being discussed.

Counter-terrorism must become the focus of policy
The government will also have to present tangible measures in the areas of migration and counter-terrorism. The deadly attack in Villach and the foiled attack in Vienna have unsettled many people. "Krone readers are demanding that politicians finally take action: Immigrants who do not want to integrate and reject our society must be consistently deported. Reforms are also needed in health and education. The health insurance fund recently reported record losses again. Companies are complaining about school leavers who cannot read and write.

Whether a swearing-in ceremony will take place next week will depend on the talks with the NEOS and the Greens. In any case, the restructuring path can be decided next week.