Overview Of Fiscal Performance Through October 2025

The execution of the state budget until the end of October 2025 has reached 65% for revenues and 59% for expenditures, according to data released by the General Accounting Office. This performance marks a decline relative to the previous period, attributed largely to reduced borrowing and lower scheduled debt repayments.

Revenue Analysis

State revenues totaled €7.63 billion, a decrease from €8.48 billion recorded in 2024. This shortfall comes despite an increase in both indirect taxes, which rose by €0.13 billion—with enhancements in VAT, consumption taxes and other related levies—and direct taxes, which saw an increase of €0.16 billion mainly driven by higher income tax collections. In stark contrast, loan withdrawals plunged to €0.09 billion compared to €1.14 billion in the prior year.

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Government Expenditures

Actual state expenditures came in at €7.68 billion, down from €8.77 billion last year. Spending on wages, pensions, and indemnities was recorded at €2.73 billion, showing a modest reduction compared to the previous period. Notably, repayments on debt and interest contracted to €0.82 billion from €2 billion, reflecting a strategic move towards lowering the fiscal burden of public debt.

Social Spending And Allocations

Social benefits experienced an uplift, totaling €1.51 billion, largely due to augmented funding for the Renewable Energy Sources Fund and increased allocations towards health services, even as social welfare outlays diminished. Additionally, transfers and grants rose to €1.46 billion—a €0.13 billion increase over the previous year—highlighting enhanced financing to municipalities, social insurance programs, and the unified European Asylum Facility.

Operational, Capital And Developmental Investments

Operational expenditures fell by 11% to €0.70 billion. Capital spending amounted to €285.1 million with significant investments directed toward road infrastructure, government buildings, water systems, and educational facilities. Meanwhile, co-financed projects reached €153.5 million, and grants awarded to universities, organizations, and for social benefits totaled €163.1 million. The General Accounting Office notes that the relatively low expenditure rate in 2025 is largely attributable to the seasonal scheduling of public debt repayments, while developmental spending achieved a 46% execution rate—surpassing the decade-long average of 42%.

This careful recalibration of fiscal policies, emphasizing reduced borrowing and measured debt servicing, underscores a broader commitment to sustainable financial management in a challenging economic environment.