Budget Deficit Reached 2.8% at the End of September

The budget deficit reached 2.8% of GDP, or €3.7 billion, at the end of September, the Ministry of Finance has announced. The published figures show that budget execution is lagging behind the initial projections.

Revenue at the end of September totalled €33.8 billion, or 68.3% of the annual target. This represents an increase of 10.9% compared with the same period last year. Expenditure stood at €37.6 billion, or 66.1% of the planned amount.

“The main reasons for the observed increase in expenditure are: higher pension spending following the indexation of pensions under the Swiss rule on 1 July 2025 and 1 July 2026; the increase in the minimum wage from January 2026; and the increase in remuneration by the amount of accumulated inflation for 2025 (5%), effective from January 2026. There has also been a significant rise in capital expenditure, due to the implementation of investments and projects under the Recovery and Resilience Plan and the Municipal Investment Programme, among other factors,” the Ministry of Finance explained.

The ministry is expected to publish its forecast for budget execution at the end of October tomorrow.