Saturday, 25 October 2025
Revenues in the Czech state budget for 2025 are expected to surpass planned levels, but risks remain on the expenditure side, the National Budget Council (NRR) said in its quarterly report on public finances. The council highlighted potential shortfalls in funding for renewable energy subsidies and salaries of non-teaching staff in education, and also criticized the classification of certain defense expenditures in the draft budget for 2026.
The NRR said Czech public finances are on course for their strongest performance since 2019, supported by a recovering economy and robust growth in tax and insurance revenues. However, it warned that structural imbalances persist and that further consolidation will be required, particularly in preparations for the 2027 budget.
Revenue from the sale of emission allowances is significantly lower than projected. While CZK 30 billion was expected for the full year, only CZK 7.9 billion had been collected by mid-year. The council has previously criticized what it described as overly optimistic estimates of this revenue stream.
On the spending side, the NRR identified gaps in funding for education and renewable energy support. An additional CZK 10 billion is needed for non-teaching staff salaries, of which only CZK 4.2 billion has so far been secured. For renewable energy, the state has already drawn heavily on its budget reserve and redirected CZK 900 million from funds earmarked for flood recovery. The council noted that a similar reallocation occurred in 2024, when CZK 14.1 billion of the CZK 30 billion flood budget was diverted to other purposes.
The Ministry of Finance defended the practice, saying the transfers complied with budget rules. It argued that less than CZK 9 billion would be required for flood programs this year, freeing up funds for other urgent expenses.
The council also raised concerns over next year’s draft budget, particularly the allocation of CZK 20.1 billion for defense spending within the Ministry of Transport chapter, compared to CZK 100 million in 2025. It called on the government to clarify which transport expenditures are now considered part of national defense.
In response, the Finance Ministry said NATO rules allow infrastructure spending to be counted toward defense if facilities serve both civilian and military purposes. It also stressed that the draft budget remains under discussion and is subject to change during government negotiations.
