The measures include eliminating subsidies, reducing ministerial expenses, and implementing steps to combat tax evasion.

On Monday, the far-right Freedom Party of Austria (FPÖ) and the conservative Austrian People’s Party (ÖVP) announced a preliminary agreement to cut €6.3 billion in public spending to avoid an excessive deficit procedure by the European Commission.

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The FPÖ leader Herbert Kickl emphasized that the agreement to balance the budget was reached in just three days—the coalition negotiations began last week—without introducing new taxes.

Instead, the measures include eliminating “excessive subsidies,” reducing ministerial expenses, and implementing steps to combat tax evasion. Both parties did not provide specific details on the proposed savings, stating that they would be disclosed once approved by the European Commission.

“We have jointly developed a €6.3 billion package that should prevent Austria from facing an excessive deficit procedure (EDP) without introducing new taxes—no inheritance taxes, no gift taxes, no wealth taxes—accompanied by measures against tax evasion and privileges, particularly those of large entities,” Kickl declared.

He assured that these cuts take into account the stability of the labor market and the economic situation, aiming to reduce the debt interest burden and prevent Austria from being “governed from Brussels.”

Kickl, the potential future head of government, stressed that his party’s priorities—such as reducing bureaucracy, supporting families, and maintaining a restrictive migration policy—would remain central pillars in future coalition negotiations. However, he described the current fiscal situation as an “avalanche of debt” requiring urgent measures. Interim ÖVP leader Christian Stocker expressed strong approval of how quickly the agreement was reached.

The European Union’s (EU) budgetary rules require member states to keep their deficit below 3% of GDP. Without savings measures, Austria would breach that limit, with a deficit projected by the European Commission at 3.7% in 2025 and 3.5% in 2026. In light of this, the Commission could launch an excessive deficit procedure if Austria does not present a convincing plan to balance its budget.

Disagreements over how to address the deficit, which arose during the government formed by the ÖVP and the Greens, were the main reason coalition negotiations failed between the Christian Democrats, Social Democrats, and Liberals. Their aim had been to keep the FPÖ, which won the late-September elections with 28.8% of the vote, out of power.

That failure led to the resignation of Karl Nehammer as leader of the ÖVP and as interim chancellor, as he had pledged not to form a coalition with the FPÖ under Kickl’s leadership. Nehammer described Kickl as “a danger to Austria’s security” due to his pro-Russian and Euroskeptic stances.

Following Nehammer’s resignation and the FPÖ’s mandate to form a government, the ÖVP’s interim leadership agreed to begin negotiations to form a coalition government in Austria. If these negotiations succeed, it would mark the first government led by the far-right FPÖ in Austria’s democratic history.

teleSUR/ JF Source: EFE

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