FINANCE

No fiscal space for additional support

No fiscal space for additional support

The return of global uncertainty, the rise in state bond yields and high inflation are forcing government officials to back off on the announcement of new horizontal support measures. Instead, they will be opting for targeted measures in favor only of the most vulnerable if there is sufficient fiscal space.

“The course of energy rates and developments in Ukraine leave little scope for support and require the containment of expenditure,” a senior Finance Ministry official tells Kathimerini.

In that context, the ministry’s message is clear: There is no fiscal leeway now for any interventions. If and when such leeway emerges, it will benefit strictly the most vulnerable. That category aside, government officials say households have in the last year enjoyed an increase in their disposable income, thanks to tax breaks and the support measures against the pandemic; that increase offsets the effects of the price hikes.

Yet for any measures the key date is April 30, when the government submits its Stability Program to the European Commission. Tourism may well help this year, though any extra revenues may be used late in the year for support purposes.