Vienna, 27 January 2012 Budget: 2011 deficit lower than expected Low interest rates and sound economy improve budget position

General government deficit at 3.3% instead of 3.9%

Last year, the general government deficit turned out somewhat lower than originally assumed. According to the figures presented by the Ministry of Finance on 27 January 2012, the 2011 budget deficit lay at 3.3% of GDP rather than the 3.9% budgeted by the government. Austria's level of debt, at 72.2%, was also somewhat lower than the 73.6% originally expected. The reason for this: the government in total spent around EUR 2.3 billion less and its revenues were around EUR 910 million higher than planned.

Three factors make up the principal reasons for this somewhat more favourable performance. Firstly, despite the recent downgrading of Austria by Standard & Poor's, Austria benefited last year from low credit interest, which earned the country a reduction in expenditure of EUR 930 million solely in terms of the financial chapter. Secondly, with the economy still on good form last year, it contributed unexpectedly high tax revenues to the budget. Of the EUR 878 million in above-target tax revenues, around half went to the Austrian provinces. Thirdly, the new budget law, with its new rules concerning reserves, means that the ministries, as indeed in past years, are being extremely disciplined with their spending.

The figures presented today are however provisional. Until the time of final account balancing, changes are still possible.