Finance mi nister Yuriko Backes addresses the joint meeting, telling the two committees that the state “has the necessary leeway” to finance the measures agreed at the tripartite last week. MFIN

Finance mi nister Yuriko Backes addresses the joint meeting, telling the two committees that the state “has the necessary leeway” to finance the measures agreed at the tripartite last week. MFIN

Finance minister Yuriko Backes has reported that state finances are on a solid foundation as she prepares the 2023 budget.

Addressing a joint meeting of the finance and budget committee (Cofibu) and the Chamber of Deputies' budget implementation control committee (Comexbu) on 26 September minister of finance Yuriko Backes (DP), reported that the state budget was running at a surplus of €969m as of 31 August.

The positive result stems from a positive development in state revenues coupled with generally stable expenditures. While pleased with the situation, “the evolution of public finances at 31 August 2022 reflects the resilience of the Luxembourg economy,” Backes said, the finance minister did issue a note of caution. “We must not lose sight of the fact that there is a clear deterioration in the coming months, and the challenges associated with the war in Ukraine and soaring energy prices will certainly leave their mark,” she told the joint committee meeting.

The agreement reached by the tripartite will also have a significant budgetary cost, but Backes said that the State “has the necessary leeway to finance the measures” agreed between the government, employers and unions.

“As I prepare the draft budget for 2023, I am committed to working on these solid foundations for the medium and long-term sustainability of our public finances, while also addressing the structural challenges facing our country," Backes said.