Austria Confirms Brussels Budget Negotiations and Resilience of International Partnerships
Over the past few days, Austria has been at the center of European attention in several respects. While Finance Minister Gunter Mayr presented a new budget path in Brussels, interim head of government Alexander Schallenberg focused on strengthening international relations during his inaugural visit to the EU. Both developments are crucial for Austria's role within the European Union.

Austria is currently facing a number of significant challenges at the European level. On the one hand, there is the threat of an EU deficit procedure, which could significantly damage the country's reputation and its ability to act financially. On the other hand, the imminent formation of a government with the participation of the traditionally EU-critical and Russia-friendly FPÖ is causing unrest in Brussels and other EU capitals.
A central problem is the EU Commission's demand that Austria presents credible and resilient measures to reduce its budget deficit. Failure to do so could result in the initiation of an excessive deficit procedure, which would entail political consequences as well as financial penalties. Furthermore, the ongoing coalition negotiations between the ÖVP and FPÖ raise questions regarding the country's future European orientation. Several EU representatives have expressed concern about how the new government will act at the European level and whether it will continue to commit to the EU's common values.
Finance Minister Mayr wants to avert EU deficit proceedings
In Brussels, Finance Minister Mayr presented the key points of the “political declaration of intent” adopted by the designated coalition of the FPÖ and ÖVP, which aims to avert the threat of an EU deficit procedure. The planned budget path envisages savings of around 6.3 billion euros by 2025 to comply with the three percent budget deficit limit required by the EU Commission.
According to information from the EU Commission, the proposed savings are expected to be detailed and resilient. The Commission emphasized that the concrete measures must be presented in good time before the next meeting of the Council of Economics and Finance Ministers on January 21. Only if the measures are deemed sufficient can an excessive deficit procedure be averted. If this is not successful, Austria could face sanctions and considerable damage to its image at the European level.
FPÖ leader Herbert Kickl emphasized that the targeted savings should be achieved without introducing new taxes. Measures to combat tax loopholes, savings in the administrative apparatus, and a reduction in excessive subsidies are planned. However, criticism of the designated coalition's budget policy has come from several EU capitals, which are skeptical about the participation of the traditionally EU-critical FPÖ in the government.
Schallenberg emphasizes Austria's reliability in Europe
Parallel to the budget negotiations, interim head of government Alexander Schallenberg made his inaugural visit to Brussels. At a meeting with EU Parliament President Roberta Metsola, Schallenberg assured that Austria would remain a strong and reliable partner of the EU. “On the occasion of Austria's 30th anniversary of EU membership, we discussed how the EU can remain the answer to people's concerns in the future,” said Metsola.
In talks with EU Council President Antonio Costa and EU High Representative for Foreign Affairs Kaja Kallas, Schallenberg also emphasized that Austria would continue to play an active role in European and international affairs. “We are facing challenging times, surprising developments, and some question marks. But right now it is important to find common solutions and strengthen Europe's ability to act,” explained Schallenberg. Security policy was a particular focus of the visit. Schallenberg promised that Austria would make its contribution to strengthening the EU's common foreign and security policy. In this context, Austria's upcoming presidency of the EU Council in 2026 was also addressed, in which the government intends to play an active role.
Concerns in the EU about coalition negotiations
The start of coalition negotiations between the ÖVP and the EU-sceptical FPÖ continues to cause concern in Brussels and other European capitals. Several EU representatives expressed their concern about how Austria's political orientation could develop under a possible FPÖ-ÖVP government. “The European Union is a union of democracies in which citizens make sovereign decisions. We must respect these decisions and cooperate with all member states”, explained EU Council President Costa.
The pressure on Austria is growing, both domestically and at the European level. The coming weeks will show whether the designated government succeeds in presenting a solid budget concept and securing the trust of its EU partners. If this succeeds, Austria could emerge stronger from the current phase and further consolidate its role in Europe. Otherwise, there is a risk of political tensions with the European institutions in addition to an excessive deficit procedure.