For 2017 expenditure is set at EUR 9.53bn, up almost 4% compared to the 2016 budget, with revenue up 5% to EUR 8.85bn. The budget deficit is planned at 1.6% of GDP, down from 2.2% of GDP planned for this year.

In 2018 expenditure is projected slightly higher, at EUR 9.57bn, but revenue is expected to rise by almost 5% again to EUR 9.27bn to bring the deficit down to 0.7% of GDP.

Despite higher budget revenue generated through economic growth, Finance Minister Mateja Vraničar says that pay policy will remain restrictive, as will social transfers and pensions.

However, an extension of some of the austerity measures in the public sector which should be endorsed along with budget documents has still not been agreed with the trade unions.

The talks failed last evening, when the unions insisted the government should accept their proposal, which the government said it would review today.

The opposition argues the issue makes it impossible to pass the budges because a failure in talks would mean an extra EUR 215m in expenditure, but the minister says the government has a contingency plan.

More revenue is planned for investment in transport infrastructure, environment, agriculture, renewables and energy efficiency, healthcare and education, science and sport.

Along with the budgets, MPs are also expected to pass the budget implementation bill which gives the government powers related to budget management and borrowing.

As in the past few years, the main sticking point remains funding for local communities. These are being offered EUR 530 in per capita as lump-sum average from the budget for 2017 and EUR 536 for 2018, which municipalities deem insufficient.

Pensioners will benefit form a 1.15% adjustment in pensions.