Revised budget deficit in 2023 to be EUR 5.37 bln higher than planned

An amendment to Poland's 2023 budget law, adopted by the Polish government on Friday, foresees the deficit PLN 24 billion (EUR 5.37 billion) higher than previously, the minister of finance has announced.

The budget deficit for 2023 was originally planned for PLN 68 billion (EUR 15.22 billion), with expenditures seen at PLN 672.5 billion (EUR 150.5 billion).

"When it comes to the deficit, it will grow by PLN 24 billion," Magdalena Rzeczkowska told a Friday press conference.

She went on to explain that expenditures had risen by PLN 20.8 billion (EUR 4.66 billion).

Rzeczkowska also said that GDP growth may be a little over 1 percent in 2023.

"We have a chance of achieving 1 percent, and even a little over 1 percent GDP growth," she said.

The original budget saw GDP growth at 1.7 percent. Rzeczkowska explained that the amendment is based on conservative forecast by financial institutions.

In a spring update to the Convergence Programme, an EU-required financial plan, the government assumed GDP growth in 2023 at the level of 0.9 percent.

The budget amendment also assumes average inflation in 2023 to stand at 12 percent, Rzeczkowska said, adding that CPI (Consumer Price Index) inflation is expected to return to single figures by year-end, assuming no unforeseen shocks on energy markets or further supply-chain disruptions.

"The annual average (inflation assumed in the draft budget amendment for 2023 - PAP) is a little higher, we had 9.8 percent, now we have 12 percent, this is the annual average gauge, at the end of this year everything indicates that it will be in single figures," Rzeczkowska said.

Prime Minister Mateusz Morawiecki said the amended budget provided an additional PLN 14 billion (EUR 3.13 billion) for local governments.