Budget: Submitted with 12 benefits and reliefs, 2.3% growth and one-off aid at 1.9 million

Nearly balanced budget—the first in decades—will be submitted at 10:00 in Parliament’s Plenary Session by the Minister of National Economy and Finance, Kostis Hatzidakis.

Compared to the draft budget submitted in early October, the final plan for 2025 will project higher GDP growth of 2.2%-2.3%, but also higher debt and inflation.

Nevertheless, it will foresee a significant reduction in the fiscal deficit. The public sector will now generate nearly zero deficits and public debt. For 2024, the general government deficit (including interest payments, not just the primary balance) is expected to drop below 1%, to just 0.7% of GDP. By 2026, it will fall even lower, to 0.6% of GDP, although the European Commission’s autumn forecasts suggest an even lower figure (just 0.1%).

While the fiscal deficit is nearly eliminated, an additional early repayment of loans amounting to nearly €12 billion by the end of 2025 is planned, reducing the country’s public debt to below 150% of GDP.

What the New Budget Brings

According to sources, the new budget will incorporate the 12 new benefits and relief measures announced by the Prime Minister at the Thessaloniki International Fair (TIF), while the government excludes—for now—additional surprises or cuts.

In 2024, an emergency financial aid package of €243 million for 1.9 million beneficiaries is set to be implemented, followed by interventions totaling €1.1 billion for 2025.

Among the measures:

• Reduction of health insurance contributions by 1% starting 1/1/2025 (0.5% for employees and 0.5% for employers).
• Abolition of the professional tax for freelancers and all individuals using invoice books.
• Pension increases of 2.45%, based on projected GDP growth of 2.2% and inflation of 2.7%. The increase takes effect on 1/1/2025.
• Salary increases across the public sector from April 2025, with the starting salary aligning with the minimum wage in the private sector.
• Permanent refund of the Special Consumption Tax (SCT) on agricultural diesel based on actual consumption.
• A 20% increase in compensation for on-call shifts for National Health System (NHS) doctors, coupled with a flat 22% tax on such compensation.
• Pay raises for uniformed personnel receiving nighttime compensation, effective 1/1/2025 (mainly targeting Security Forces).

Key Figures

The 2025 state budget is expected to include:

• GDP growth rates of 2.2% for 2024 and 2.3% for 2025, unchanged from the draft plan.
• An increase in primary expenditures by 2.6% in 2024 and 3.6% in 2025—equivalent to around €3 billion in 2024 and €5 billion in 2025.
• A primary surplus of 2.5% of GDP in 2024 and 2.4% in 2025.
• A drastic reduction in the fiscal deficit to 0.7% of GDP in 2024 and to 0.6% or lower in 2025. The initial draft budget projected a 1% deficit for 2024 and 0.6% for 2025, but the European Commission estimates even lower figures.
• Public debt at 154% of GDP in 2024 and further reduction to 147.5% in 2025. Notably, following Eurostat’s October 18 announcements, public debt now includes €12.4 billion in loan interest payments deferred to 2032, mitigating the risk of a sudden debt surge many had feared for that period.
• Inflation at 2.7% in 2024, persisting at 2.4% in 2025, despite the draft budget predicting a steeper drop to 2.1% next year.

Who Will Receive €100-420?

Before the year ends, approximately 1.9 million beneficiaries are expected to receive a one-time allowance ranging from €100 to €420—or even more for families with over four children—by Christmas. Specifically:

• €100-200 for approximately 700,000 pensioners who will not receive the annual increase due to their personal difference exceeding €10.

The allowance will be distributed as follows:

• €200 for pensions up to €700.
• €150 for pensions from €700.01 to €1,100.
• €100 for pensions from €1,100.01 to €1,600.

A one-time financial aid of €200 will also be granted to:

An extra 50% of the monthly allowance will be granted to beneficiaries of the Guaranteed Minimum Income.

Recipients of e-EFKA disability benefits.

Recipients of absolute disability benefits for former OGA pensioners receiving only the basic pension.

Recipients of illness and incapacity benefits for civil service pensioners.

Recipients of extrainstitutional benefits provided by e-EFKA.

Recipients of OPEKA disability benefits.

Uninsured elderly individuals.

An additional monthly installment will be given to beneficiaries of OPEKA’s child allowance. For instance, families with four children in the first beneficiary category will receive €420.

Source: pagenews.gr