Recommendation for a COUNCIL RECOMMENDATION on the economic, social, employment, structural and budgetary policies of Slovakia
Date: 2025-06-04
Institutions: European Commission, Reform and Investment Task Force
Subjects: Slovakia, budget policy, economic policy, economic recovery, economic reform, employment policy, investment, labour market, social policy, stability pact

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   EUROPEAN COMMISSION  Brussels, 4.6.2025  COM(2025) 225 final  Recommendation for a COUNCIL RECOMMENDATION on the economic, social, employment, structural and budgetary policies of Slovakia {SWD(2025) 225 final}  
 
Recommendation for a 

COUNCIL RECOMMENDATION 

on the economic, social, employment, structural and budgetary policies of Slovakia 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 121(2) and Article 148(4) thereof, 

Having regard to Regulation (EU) 2024/1263 of the European Parliament and of the Council 
of  29 April  2024  on  the  effective  coordination  of  economic  policies  and  on  multilateral 
budgetary surveillance and repealing Council Regulation (EC) No 1466/971, and in particular 
Article 3(3) thereof, 

Having  regard  to  Regulation  (EU)  No 1176/2011  of  the  European  Parliament  and  of  the 
Council  of  16 November 2011  on  the  prevention  and  correction  of  macroeconomic 
imbalances2, and in particular Article 6(1) thereof, 

Having regard to the recommendation of the European Commission, 

Having regard to the resolutions of the European Parliament, 

Having regard to the conclusions of the European Council, 

Having regard to the opinion of the Employment Committee, 

Having regard to the opinion of the Economic and Financial Committee, 

Having regard to the opinion of the Social Protection Committee, 

Having regard to the opinion of the Economic Policy Committee, 

Whereas: 

General considerations 

(1) 

Regulation (EU) 2024/1263, which entered into force on 30 April 2024, specifies the 
objectives  of  the  economic  governance  framework,  which  aims  at  promoting  sound 
and  sustainable  public  finances  and  sustainable  and  inclusive  growth  and  resilience 
through reforms and investments, and preventing excessive government deficits. The 
Regulation  stipulates  that  the  Council  and  the  Commission  conduct  multilateral 
surveillance in the context of the European Semester in accordance with the objectives 
and requirements set out in the TFEU. The European Semester includes, in particular, 
the  formulation,  and  the  surveillance  of  the  implementation  of  country-specific 
recommendations.  The  Regulation  also  promotes  national  ownership  of  fiscal  policy 
and  emphasises  its  medium-term  focus,  combined  with  more  effective  and  coherent 
enforcement. Each Member State must submit to  the Council and the Commission  a 
national  medium-term  fiscal-structural  plan,  containing  its  fiscal,  reform  and 
investment  commitments,  over  4  or  5  years,  depending  on  the  length  of the  national 

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OJ L, 2024/1263, 30.4.2024, ELI: http://data.europa.eu/eli/reg/2024/1263/oj. 
OJ L 306, 23.11.2011, p. 25, ELI: http://data.europa.eu/eli/reg/2011/1176/oj. 

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legislative  term.  The  net  expenditure3  path  in  these  plans  has  to  comply  with  the 
Regulation’s  requirements,  including  the  requirements  to  put  or  keep  general 
government debt on a plausibly downward path by the end of the adjustment period, or 
for it to remain at prudent levels below 60% of gross domestic product (GDP), and to 
bring  and/or  maintain  the  general  government  deficit  below  the  3%-of-GDP  Treaty 
reference value over the medium term. Where a Member State commits to a relevant 
set  of  reforms  and  investments  in  accordance  with  the  criteria  set  out  in  the 
Regulation, the adjustment period may be extended by up to three years. 
Regulation  (EU)  2021/241  of  the  European  Parliament  and  of  the  Council4,  which 
established  the  Recovery  and  Resilience  Facility  (the  ‘RRF’),  entered  into  force  on 
19 February 2021.  The  RRF  provides  financial  support  to  Member  States  for 
implementing  reforms  and  investments,  delivering  a  fiscal  impulse  financed  by  the 
Union.  In  line  with  the  priorities  of  the  European  Semester  for  economic  policy 
coordination, the RRF fosters economic and social recovery while driving sustainable 
reforms and investments, in particular promoting the green and digital transitions and 
making  Member  States’  economies  more  resilient.  It  also  helps  strengthen  public 
finances  and  boost  growth  and  job  creation  in  the  medium  and  long  term,  improve 
territorial cohesion within the Union and support the continued implementation of the 
European Pillar of Social Rights. 
Regulation  (EU)  2023/435  of  the  European  Parliament  and  of  the  Council5  (the 
‘REPowerEU  Regulation’),  which  was  adopted  on  27 February 2023,  aims  to  phase 
out the Union’s dependence on Russian fossil-fuel imports. This helps achieve energy 
security  and  diversify  the  Union’s  energy  supply,  while  increasing  the  uptake  of 
renewables,  energy  storage  capacities  and  energy  efficiency.  Slovakia  added  a  new 
REPowerEU chapter to its national recovery and resilience plan in order to finance key 
reforms and investments that will help achieve the REPowerEU objectives. 

On 29 April 2021, Slovakia submitted its national recovery and resilience plan to the 
Commission, in accordance with Article 18(1) of Regulation (EU) 2021/241. Pursuant 
to Article 19 of that Regulation, the Commission assessed the relevance, effectiveness, 
efficiency  and  coherence  of  the  recovery  and  resilience  plan,  in  accordance  with  the 
assessment guidelines set  out  in  Annex V.  On  13 July  2021, the Council adopted its 
Implementing Decision approving the assessment of the recovery and resilience plan 
for Slovakia6, which was amended under Article 18(2) on 14 July 2023 to update the 
maximum  financial  contribution  for  non-repayable  financial  support,  as  well  as  to 

Net  expenditure  as  defined  in  Article  2,  point  (2),  of  Regulation  (EU)  2024/1263:  ‘net  expenditure’ 
means government expenditure net of (i) interest expenditure; (ii) discretionary revenue measures; (iii) 
expenditure  on  programmes  of  the  Union  fully  matched  by  revenue  from  Union  funds;  (iv)  national 
expenditure  on  co-financing  of  programmes  funded  by  the  Union;  (v)  cyclical  elements  of 
unemployment benefit expenditure; and (vi) one-offs and other temporary measures. 
Regulation  (EU)  2021/241  of  the  European  Parliament  and  of  the  Council  of  12 February 2021 
establishing 
(OJ  L  57,  18.2.2021,  p. 17,  ELI: 
http://data.europa.eu/eli/reg/2021/241/oj). 
Regulation  (EU)  2023/435  of  the  European  Parliament  and  of  the  Council  of  27 February 2023 
amending Regulation (EU) 2021/241 as regards REPowerEU chapters in recovery and resilience plans 
and  amending  Regulations  (EU)  No 1303/2013,  (EU)  2021/1060  and  (EU)  2021/1755,  and  Directive 
2003/87/EC (OJ L 63, 28.2.2023, p. 1, ELI: http://data.europa. eu/eli/reg/2023/435/oj). 
Council Implementing Decision of 13 July 2021 on the approval of the assessment of the recovery and 
resilience plan for Slovakia (ST 10156/2021; ST 10156/2021 ADD 1; ST 10156/2021 COR 1). 

the  Recovery  and  Resilience  Facility 

(2) 

(3) 

(4) 

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(5) 

(6) 

(7) 

include  the  REPowerEU  chapter7.  The  release  of  instalments  is  conditional  on  the 
adoption  of  a  decision  by  the  Commission,  in  accordance  with  Article 24(5),  stating 
that Slovakia has satisfactorily achieved the relevant milestones and targets set out in 
the  Council  Implementing  Decision.  Satisfactory  achievement  requires  that  the 
achievement  of  preceding  milestones  and  targets  for  the  same  reform  or  investment 
has not been reversed. 

On  21  January  2025  the  Council,  upon  the  recommendation  of  the  Commission, 
adopted a recommendation endorsing the national medium-term fiscal-structural plan 
of Slovakia8. The plan was submitted in accordance with Article 11 and Article 36(1), 
point (a), of Regulation (EU) 2024/1263, covers the period from 2025 until 2028 and 
presents a fiscal adjustment spread over four years. 

On  26 November 2024,  the  Commission  adopted  an  opinion  on  the  2025  draft 
budgetary  plan  of  Slovakia.  On  the  same  date,  on  the  basis  of  Regulation  (EU) 
No 1176/2011, the Commission adopted the 2025 Alert Mechanism Report, in which 
it identified Slovakia as one of the Member States for which an in-depth review would 
be  needed.  The  Commission  also  adopted  a  recommendation  for  a  Council 
recommendation on the economic policy of the euro area and a proposal for the 2025 
Joint  Employment  Report,  which  analyses  the  implementation  of  the  Employment 
Guidelines  and  the  principles  of  the  European  Pillar  of  Social  Rights.  The  Council 
adopted  the  Recommendation  on  the  economic  policy  of  the  euro  area9  on  13  May 
2025 and the Joint Employment Report on 10 March 2025. 

On  29 January 2025,  the  Commission  published  the  Competitiveness  Compass,  a 
strategic framework that aims to boost the EU’s global competitiveness over the next 
five  years.  It  identifies  the  three  transformative  imperatives  of  sustainable  economic 
growth: (i) innovation; (ii) decarbonisation and competitiveness; and (iii) security. To 
close  the  innovation  gap,  the  EU  aims  to  foster  industrial  innovation,  support  the 
growth of start-ups through initiatives like the EU Start-up and Scale-up Strategy, and 
promote the adoption of advanced technologies like artificial intelligence and quantum 
computing.  In  pursuit  of  a  greener  economy,  the  Commission  has  outlined  a 
comprehensive Affordable Energy Action Plan and a Clean Industrial Deal, ensuring 
that  the  shift  to  clean  energy  remains  cost-effective,  competitiveness-friendly, 
particularly  for  energy-intensive  sectors,  and  is  a  driver  for  growth.  To  reduce 
excessive dependencies and increase security, the Union is committed to strengthening 
global  trade  partnerships,  diversifying  supply  chains  and  securing  access  to  critical 
raw materials and clean energy sources. These priorities are underpinned by horizontal 
enablers, namely regulatory simplification, deepening of the single market, financing 
competitiveness and a Savings and Investments Union, promotion of skills and quality 
jobs, and better coordination of EU policies. The Competitiveness Compass is aligned 
with  the  European  Semester,  ensuring  that  Member  States’  economic  policies  are 
consistent with the Commission’s strategic objectives, creating a unified approach to 

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Council Implementing Decision of 14 July 2023 amending the Implementing Decision of 13 July 2021 
on  the  approval  of  the  assessment  of  the  recovery  and  resilience  plan  for  Slovakia  (ST  11205/2023 
INIT, ST 11205 2023 ADD 1). 
Council  Recommendation  of  21 January  2025  endorsing  the  medium-term  fiscal-structural  plan  of 
Slovakia, OJ C/2025/645, 10.2.2025. 
Council  Recommendation  of  13  May  2025  on  the  economic  policy  of  the  euro  area  (OJ  C, 
C/2025/2782, 22.5.2025, ELI: http:// data.europa.eu/eli/C/2025/2782/oj). 

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(8) 

economic governance that fosters sustainable growth, innovation and resilience across 
the Union. 

In  2025,  the  European  Semester  for  economic  policy  coordination  continues  to 
develop  alongside  the  implementation  of  the  RRF.  The  full  implementation  of  the 
recovery and resilience plans remains essential for delivering on the policy priorities 
under the European Semester, as the plans help effectively address all or a significant 
subset  of  challenges  identified  in  the  relevant  country-specific  recommendations 
issued  in  recent  years.  These  country-specific  recommendations  remain  equally 
relevant  for  the  assessment  of  amended  recovery  and  resilience  plans  in  accordance 
with Article 21 of Regulation (EU) 2021/241. 

(9) 

The  2025  country-specific  recommendations  cover 
the  key  economic  policy 
challenges that are not sufficiently addressed by measures included in the recovery and 
resilience  plans,  taking  into  account  the  relevant  challenges  identified  in  the  2019-
2024 country-specific recommendations. 

(10)  On  4  June  2025,  the  Commission  published  the 2025  country  report  for  Slovakia.  It 
assessed  Slovakia’s  progress 
relevant  country-specific 
in  addressing 
recommendations  and  took  stock  of  Slovakia’s  implementation  of  the  recovery  and 
resilience plan. Based on this analysis, the country report identified the most pressing 
challenges Slovakia is facing. It also assessed Slovakia’s progress in implementing the 
European  Pillar  of  Social  Rights  and  in  achieving  the  Union  headline  targets  on 
employment, skills and poverty reduction, as well as progress in achieving the United 
Nations Sustainable Development Goals. 

the 

(11)  The  Commission  carried  out  an  in-depth  review  under  Article 5  of  Regulation  (EU) 
No 1176/2011  for  Slovakia.  The  main  findings  of  the  Commission’s  assessment  of 
macroeconomic vulnerabilities for  Slovakia for the purposes of that Regulation  were 
published  on  13  May  202510.  On  4  June  2025,  the  Commission  concluded  that 
Slovakia  is  experiencing  macroeconomic  imbalances.  In  particular,  despite  some 
improvements,  the  vulnerabilities  related  to  cost  competitiveness,  external  balance, 
and housing market persist, while improvements in household indebtedness seem to be 
stronger,  and  policy  action  has  been  limited.  Inflation  and  unit  labour  costs  growth 
decreased significantly but differentials, including of core inflation, with the rest of the 
euro  area  and  the  EU  persist.  After  the  marked  improvement  of  2023  due  to  lower 
energy prices,  the current  account  deficit worsened somewhat  in  2024 on account  of 
sluggish  exports and  rising  imports amid a  re-surgent  domestic demand.  The current 
account  deficit  is  expected  to  further  increase  this  year.  In  parallel,  the  high 
government deficit is not declining. Additionally, house prices accelerated again in the 
course  of  2024,  while  the  decline  of  residential  construction  exacerbates  an  already 
tight  housing  supply.  After  several  years  of  strong  rises  in  household  debt,  higher 
interest  rates  slowed  down  the  demand  for  mortgages  in  the  past  two  years  and 
household debt ratios decreased in recent years. However, as financial conditions have 
eased in the course of 2024 and early 2025, household borrowing has been rebounding 
lately and has been further supported by increasing real disposable income in a context 
of a tight labour market. Denominator effects are becoming less significant, such that 
household  debt  ratios  may  stabilise  or  fall  less  in  the  near  term  than  before,  while 
remaining  still below the EU  average in a  context  of a sound banking  sector. Policy 
progress  has  been  limited.  In  order  to  curb  inflation,  energy  support  measures  for 

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SWD(2025) 125 final. 

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households  have  been  prolonged.  Yet  this  untargeted  measure  became  one  of  the 
drivers of the sizeable government and current account deficits. Adoption of measures 
to  improve  labour  productivity  and  the  business  environment  remain  limited.  An 
amendment  to  the  Construction  Act,  aimed  at  streamlining  construction  procedures, 
became effective this April. 

Assessment of the Annual Progress Report 

(12)  On 21 January 2025 the Council recommended the following maximum growth rates 
of net expenditure for Slovakia: 3.8% in 2025, 0.9% in 2026, 1.6% in 2027, and 1.5% 
in  2028,  which  correspond  to  the  maximum  cumulative  growth  rates  calculated  by 
reference  to  2023  of  10.3%  in  2025,  11.2%  in  2026,  13.0%  in  2027,  and  14.8%  in 
2028. In 2025-2027, these maximum growth rates of net expenditure coincide with the 
in  accordance  with  Article  3(4)  of  Regulation  1467/97,  as 
corrective  path 
recommended by the Council on  21 January 2025  with  a view to bringing an end to 
the situation of an excessive deficit11. On 30 April 2025 Slovakia submitted its Annual 
Progress  Report12, on  action taken in  response to  the Council recommendation of  21 
January  2025  with  a  view  to  bringing  an  end  to  the  situation  of  an  excessive  deficit 
and the implementation of reforms and investments responding to the main challenges 
identified  in  the  European  Semester  country-specific  recommendations.  The  Annual 
Progress  Report  also  reflects  Slovakia’s  biannual  reporting  on  the  progress  made  in 
achieving its recovery and resilience plan in accordance with Article 27 of Regulation 
(EU) 2021/241. 

(13)  Russia’s  war  of  aggression  against  Ukraine  and  its  repercussions  constitute  an 
existential  challenge  for  the  European  Union.  The  Commission  recommended  to 
activate the national  escape clause of the Stability and Growth Pact  in  a coordinated 
manner to support the EU efforts to achieve a rapid and significant increase in defence 
spending and this proposal was welcomed by the European Council of 6 March 2025. 
Following the request of Slovakia on 30 April 2025, on [date] the Council, upon the 
recommendation of the Commission, adopted a recommendation allowing Slovakia to 
deviate  from,  and  exceed,  the  recommended  maximum  growth  rates  of  net 
expenditure13. 

(14)  Based on data validated by Eurostat14, Slovakia’s general government deficit increased 
from a deficit of 5.2% of GDP in 2023 to a deficit of 5.3% in 2024, while the general 
government debt rose from 55.6% of GDP at the end of 2023 to 59.3% at the end of 
2024. According to the Commission’s calculations, these developments correspond to 
a  net  expenditure  growth  rate  of  5.4%  in  2024.  In  the  Annual  Progress  Report, 
Slovakia  estimates  the  net  expenditure  growth  in  2024  at  3.0%.  The  Commission 
estimates  that  the  net  expenditure  growth  was  higher  than  in  the  Annual  Progress 
Report.  The  difference  between  the  Commission’s  calculations  and  the  estimates  of 
national  authorities is  due to  lower expenditure funded from  the EU in  2023 used in 
the assumptions underlying the Annual Progress Report. Based on the Commission’s 

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Council  Recommendation  with  a  view  to  bringing  an  end  to  the  situation  of  an  excessive  deficit  in 
Slovakia, C/2025/5039. 
The  2025  Annual  Progress  Reports  are  available  on:  https://economy-finance.ec.europa.eu/economic-
and-fiscal-governance/stability-and-growth-pact/preventive-arm/annual-progress-reports_en.  
Council  Recommendation  allowing  Slovakia  to  deviate  from,  and  exceed,  the  recommended  net 
expenditure  path  (Activation  of  the  national  escape  clause),  [Please  Complete:  OJ  C/2025/xxx, 
x.x.2025]. 
Eurostat-Euro Indicators, 22.4.2025. 

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estimates,  the  fiscal  stance15,  which  includes  both  nationally  and  EU  financed 
expenditure, was contractionary, by 2.2% of GDP, in 2024. 

(15)  According to the Annual Progress Report, the macroeconomic scenario underpinning 
the budgetary projections by Slovakia expects real GDP growth at 1.9% in both 2025 
and 2026, while HICP inflation is  projected at  3.9% in  2025 and 3.7% in 2026. The 
Commission  Spring  2025  Forecast  projects  real  GDP  to  grow  by  1.5%  in  2025  and 
1.4% in 2026, and HICP inflation to stand at 4.0% in 2025 and 2.9% in 2026.  

(16) 

In the Annual Progress Report, the general government deficit is expected to decrease 
to  4.9%  of  GDP  in  2025,  while  the  general  government  debt-to-GDP  ratio  is  set  to 
increase  to  61.1%  by  the  end  of  2025.  These  developments  correspond  to  net 
expenditure growth of 3.6% in 2025. The Commission Spring 2025 Forecast projects a 
general  government  deficit  of  4.9%  of  GDP  in  2025.  The  decrease  of  the  deficit  in 
2025  mainly  reflects  the  revenue-increasing  consolidation  measures  adopted  by 
Slovak  government  for  2025.  According  to  the  Commission’s  calculations,  these 
developments  correspond  to  net  expenditure  growth  of  3.8%  in  2025.  Based  on  the 
Commission’s  estimates,  the  fiscal  stance,  which  includes  both  nationally  and  EU 
financed expenditure, is projected to be broadly neutral at 0.2% of GDP, in 2025. The 
general government debt-to-GDP ratio is set to increase to 60.9% by the end of 2025. 
The increase of the debt-to-GDP ratio in 2025 mainly reflects the high primary deficit. 

(17)  General  government  expenditure  amounting  to  1.4%  of  GDP  is  expected  to  be 
financed  by  non-repayable  support  (“grants”)  from  the  Recovery  and  Resilience 
Facility  in  2025,  compared  to  0.7%  of  GDP  in  2024,  according  to  the  Commission 
Spring 2025 Forecast. Expenditure financed by Recovery and Resilience Facility non-
repayable support enables high-quality investment and productivity-enhancing reforms 
without a direct impact on the general government balance and debt of Slovakia.  

(18)  General  government  defence  expenditure  in  Slovakia  amounted  to  1.4%  of  GDP  in 
2021,  1.0%  of  GDP  in  2022  and  1.2%  of  GDP  in  202316.  According  to  the 
Commission  Spring  2025  Forecast,  expenditure  on  defence  is  projected  at  1.3%  of 
GDP  in  2024  and  2.3%  of  GDP  in  2025.  This  corresponds  to  an  increase  of  0.9 
percentage  points  of  GDP  compared  to  2021.  The  period  when  the  national  escape 
clause is activated (2025-2028) allows Slovakia to reprioritise government expenditure 
or increase government revenue so that lastingly higher defence expenditure would not 
endanger fiscal sustainability in the medium term. 

(19)  According  to  the  Commission  Spring  2025  Forecast,  net  expenditure  in  Slovakia  is 
projected to grow by 3.8% in 2025 and 9.3% cumulatively in 2024 and 2025. Based on 
the Commission Spring 2025 Forecast, the net expenditure growth of Slovakia in 2025 
is  projected  to  be  below  the  recommended  maximum  growth  rate  established  by  the 
corrective  path,  both  annually  and  when  considering  2024  and  2025  together. 
Therefore, the excessive deficit procedure for Slovakia is held in abeyance.  

15 

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The fiscal stance is defined as a measure of the annual change in the underlying budgetary position of 
the  general  government.  It  aims  to  assess  the  economic  impulse  stemming  from  fiscal  policies,  both 
those  that  are  nationally  financed  and  those  that  are  financed  by  the  EU  budget.  The  fiscal  stance  is 
measured as the difference between (i) the medium-term potential growth and (ii) the change in primary 
expenditure net of discretionary revenue measures and including expenditure financed by non-repayable 
support (grants) from the Recovery and Resilience Facility and other Union funds. 
Eurostat, government expenditure by classification of functions of government (COFOG).  

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(20) 

(21) 

In the Annual Progress Report, the general government deficit is projected to decrease 
to 4.5% of GDP in 2026, while the general government debt-to-GDP ratio is projected 
to increase to 63.3% by the end of 2026. Based on policy measures known at the cut-
off  date  of  the  forecast,  the  Commission  Spring  2025  Forecast  projects  a  general 
government  deficit  of  5.1%  of  GDP  in  2026.  The  increase  of  the  deficit  in  2026 
mainly reflects  a worsening of the macroeconomic outlook combined with persisting 
expenditure-increasing  discretionary  measures,  notably  a  permanent  13th  pension 
payment, or an increase in healthcare spending. These developments correspond to net 
expenditure growth of 3.9% in 2026. Based on the Commission’s estimates, the fiscal 
stance, which includes both nationally and EU financed expenditure, is projected to be 
neutral  in  2026.  Fiscal  consolidation  could  also  contribute  to  improving  the  external 
position. The general government debt-to-GDP ratio is projected by the Commission 
to increase to 63.0% by the end of 2026. The increase of the debt-to-GDP ratio in 2026 
mainly reflects the high primary deficit. 

Key policy challenges 

In 2024, Slovakia’s tax wedge (the taxation of earnings from labour) surpassed the EU 
average for low-income earners, with a rate of 38.2% for individuals earning 50% of 
the  average  wage,  compared  to  the  EU  average  of  31.8%.  However,  the  wedge  was 
closer  to  the  EU  average  at  higher  income  levels,  indicating  that  the  tax  burden  is 
relatively  more  substantial  for  lower  income  earners.  Property  tax  revenues  in  2023 
were low at 0.4% of GDP, compared to the EU average of 1.9%, primarily due to the 
area-based property taxation system in Slovakia, which does not factor in aspects like 
location  or  market  value  in  the  fiscal  computation.  This  results  in  stagnant  tax 
revenues,  against  the  backdrop  of  rising  house  prices  in  recent  years  and  issues 
concerning fairness and equity. Furthermore, revenues from Slovakia’s environmental 
taxation,  especially  in  areas  like  transport,  pollution,  and  natural  resources,  are 
consistently below the EU average. The effective carbon rate in Slovakia is EUR 64.1 
per  tonne  of  CO2,  which  is  significantly  lower  than  the  EU  average  of  EUR 84.8, 
suggesting  weaker  economic  incentives  for  reducing  emissions.  Slovakia  is  taking 
measures  to  boost  the  efficiency  of  its  tax  collection  system  by  investing  in  IT 
infrastructure  and  implementing  a  comprehensive  digital  transformation  strategy. 
Although  the  VAT  gap  has  narrowed  significantly  in  recent  years,  the  VAT 
compliance  gap  still  remains  substantially  higher  than  the  EU  average.  To  address 
high  government  deficits,  Slovakia  has  introduced  measures  that  aim  to  increase 
government  revenues,  which  negatively  affect  price  competitiveness  and  result  in 
uneven  resource  distribution.  Specifically,  the  recently  implemented  tax  on  financial 
transactions  hampers  the  business  environment,  contributes  to  higher  prices  and 
encourages the use of cash payments, raising concerns about potential tax evasion. In 
addition,  the  government  has  extended  measures  that  aim  to  mitigate  the  social 
impacts of high energy prices. However, these measures are not targeted to vulnerable 
people and distort the price signals from energy markets. Furthermore, the insufficient 
implementation  of  existing  spending  reviews  in  the  budgetary  process  hinders  the 
achievement  of  potential  savings  that  could  improve  public  finances.  Advancing  the 
digitalisation  of  tax  administration,  particularly  in  electronic  invoicing  and  pre-filled 
tax  returns,  could  help  reduce  tax  system  leaks,  simplify  compliance  and  lower 
associated costs. 

(22)  Slovakia continues to face a significant housing shortage, with the number of houses 
per  thousand  inhabitants  among  the  lowest  across  OECD  countries.  Residential 
construction is  below the EU  average and has been declining  since the  end of  2023. 

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legislative 

There  has  also  been  a  similar  downward  trend  in  the  number  of  building  permits 
issued  as  of  the  end  of  2023.  This  is  the  result  of  Slovakia’s  inefficient  permitting 
procedures,  driven  by  high  administrative  fragmentation  and  inadequate  resources  at 
the municipal level.  Supporting housing supply is  also  conducive to  containing risks 
related to the household debt. In addition, the rental market is underdeveloped, due to 
rentals  over 
the 
homeownership. Homeownership remains the preferred option of most households in 
Slovakia, as rents are high, and the availability of rental accommodation is low. At the 
same time, the very limited supply of social housing – only 1.6% of the housing stock 
– presents a hurdle to accessing housing for the most vulnerable people. Rising house 
prices  and  declining  residential  construction  further  constrain  housing  accessibility 
and affordability. 

framework  not  being  conducive 

favouring 

to 

(23) 

In accordance with Article 19(3), point (b), of Regulation (EU) 2021/241 and criterion 
2.2  of  Annex  V  to  that  Regulation,  the  recovery  and  resilience  plan  includes  an 
extensive set  of mutually reinforcing  reforms and investments  to  be implemented by 
2026.  These  are  expected  to  help  effectively  address  all  or  a  significant  subset  of 
challenges  identified  in  the  relevant  country-specific  recommendations.  Within  this 
tight timeframe, finalising the effective implementation of the recovery and resilience 
plan is essential to boost Slovakia’s long-term competitiveness through the green and 
digital  transitions,  while  ensuring  social  fairness.  To  deliver  on  the  commitments  of 
the  recovery  and  resilience  plan  by  August  2026,  it  is  essential  for  Slovakia  to 
accelerate  the  implementation  of  reforms  and  investments  by  addressing  relevant 
challenges.  In  particular,  an  unpredictable  regulatory  environment,  administrative 
burdens  and  a  fragmented  governance  structure,  as  well  as  inefficient  public 
procurement  processes  and  insufficient  preparation  of  investment  projects  impact 
Slovakia’s  capacity  to  effectively  implement  investment  projects  and  absorb  EU 
funding,  significantly  hindering  Slovakia’s  potential  for  innovation  and  economic 
diversification.  The  systematic  involvement  of  local  and  regional  authorities,  social 
partners,  civil  society  and  other  relevant  stakeholders  remains  essential  in  order  to 
ensure  broad  ownership  for  the  successful  implementation  of  the  recovery  and 
resilience plan. 

(24)  The  implementation  of  the  cohesion  policy  programme,  which  encompasses  support 
from  the  European  Regional  Development  Fund  (ERDF),  the  Just  Transition  Fund 
(JTF),  the  European  Social  Fund  Plus  (ESF+)  and  the  Cohesion  Fund  (CF),  has 
accelerated  in  Slovakia.  It  is  important  to  continue  efforts  to  ensure  the  swift 
implementation  of  this  programme,  while  maximising  its  impact  on  the  ground. 
Slovakia  is  already  taking  action  under  its  cohesion  policy  programme  to  boost 
competitiveness and growth. At the same time, Slovakia continues to face challenges, 
including  those  relating  to  enhancing  competitiveness  in  the  context  of  industrial 
transition,  boosting  innovation  capacity,  including  for  developing  and  manufacturing 
critical  technologies,  increasing  water  resilience  and  housing,  as  well  as  the 
accessibility of early childhood education and care and labour market participation of 
disadvantaged groups.  In accordance with  Article 18 of Regulation  (EU)  2021/1060, 
Slovakia is required – as part of the mid-term review of the cohesion policy funds – to 
review  its  programme  taking  into  account,  among  other  things,  the  challenges 
identified in the 2024 country-specific recommendations. The Commission proposals 

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adopted on 1 April 202517 extend the deadline for submitting an assessment – for each 
programme – of the outcome of the mid-term review beyond 31 March 2025. It also 
provides flexibilities to  help  speed up programme implementation  and incentives for 
Member States to allocate cohesion policy resources to five strategic priority areas of 
the Union, namely competitiveness in strategic technologies, defence, housing, water 
resilience and energy transition.  

(25)  The  Strategic  Technologies  for  Europe  Platform  (STEP)  provides  the  opportunity  to 
invest in a key EU strategic priority by strengthening the EU’s competitiveness. STEP 
is channelled through 11 existing EU funds. Member States can also contribute to the 
InvestEU  programme  supporting  investments  in  priority  areas.  Slovakia  could  use 
these initiatives to support the development or manufacturing of critical technologies, 
including clean and resource-efficient technologies. 

(26)  Beyond the economic and social challenges addressed by the recovery and resilience 
plan  and  other  EU  funds,  Slovakia  faces  several  additional  challenges  related  to 
decarbonisation and the transformation of industry, the development of zero-emission 
mobility, the business  environment and public administration, digitalisation,  research 
and innovation, the justice system, the labour market, education and healthcare. 

(27)  As  set  in  the  Competitiveness  Compass,  all  the  EU,  national,  and  local  institutions 
must  make  a  major  effort  to  produce  simpler  rules  and  to  accelerate  the  speed  of 
administrative  procedures.  The  Commission  has  set  ambitious  goals  for  reducing 
administrative burden: by at least 25% and by at least 35% for SMEs; and has created 
new  tools  to  achieve  these  goals,  including  systematic  stress  test  of  the  stock  of  EU 
legislation and enhanced stakeholders’ dialogue. To match this ambition, Slovakia also 
needs  to  take  action.  78%  of  businesses  consider  the  complexity  of  administrative 
procedures  to  be  a  problem  for  their  company  when  doing  business  in  Slovakia18. 
regulatory 
Long  and  complex  administrative  procedures,  an  unpredictable 
environment,  fast-changing  legislation  and  insufficient  investment  planning  make 
Slovakia’s  business  environment  one  of  the  least  favourable  in  the  EU.  In  Slovakia, 
legislation tends to change rapidly and fast-track legislative procedures have become 
common when adopting new laws. Between October 2023 and February 2025, 37% of 
all adopted laws bypassed standard impact assessments and stakeholder consultations. 
The current better regulation framework in Slovakia lacks clear and transparent rules 
and is  not  implemented  effectively.  Despite the introduction of measures  to  improve 
the  business  environment,  including  in  Slovakia’s  recovery  and  resilience  plan,  the 
overall improvements have been marginal. 

from 

large  disparities 

(28)  Slovakia’s competitiveness is hindered by a fragmented public administration, limited 
transparency in public procurement, and weak investment planning. Local governance 
suffers 
in  municipality  size,  underfunded  additional 
responsibilities, and a lack of strategic planning. Investment planning is still tied to EU 
funding cycles and lacks a long-term vision, which creates uncertainty for businesses 
and  local  authorities.  Small  municipalities,  in  particular,  need  more  training  and 
capacity  to  manage  investments  and  access  EU  funds.  Despite  recent  reforms  in  the 
assessment, selection and budgeting of public investment, the monitoring and ex post 

17 

18 

Proposal  for  a  REGULATION  OF  THE  EUROPEAN  PARLIAMENT  AND  OF  THE  COUNCIL 
amending  Regulations  (EU)  2021/1058  and  (EU)  2021/1056  as  regards  specific  measures  to  address 
strategic challenges in the context of the mid-term review - COM(2025) 123 final. 
Businesses' attitudes towards corruption in the EU’ Flash Report, Eurobarometer Report (April 2024). 

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assessment  of  projects  remain  weak.  As  Slovakia  develops  a  national  investment 
strategy until 2050, it is essential that the strategy secures broad political support and 
is  adopted  in  good  time.  Reforming  the  local  governance  structure  and  ensuring 
adequate  funding  for  the  various  responsibilities  could  significantly  advance 
Slovakia’s structural capacity for investment planning and implementation. Further to 
this,  Slovakia  also  needs  to  improve  the  provision  of  quality  public  services  at  local 
level and strengthen the financial independence and management capacity of local and 
regional governments. 

(29)  Although recent reforms aim to simplify public procurement procedures, there are still 
concerns about insufficient transparency and competition, as the percentage of public 
contracts  awarded  in  procedures  with  one  single  bidder  amounted  to  33%  in  2023. 
Transparency  and  competition  in  public  procurement  processes  are  necessary  to 
promote  good  governance  and  improve  the  effectiveness  of  public  spending. 
Moreover, despite the adoption of the Public Procurement Procedures Act, which aims 
to  strengthen  the  rules  for  green  public  procurement  and  improve  the  use  of  quality 
criteria and life cycle costing, the majority of contracts in Slovakia are still awarded on 
the basis of the lowest price. 

(30)  There are concerns over the Slovak judicial system. In particular, sufficient guarantees 
as regards the dismissal of the members of the Judicial Council are still not in place. 
Several developments, such as the dismantling of specialised anti-corruption agencies 
(the Special Prosecution Office and the National Crime Agency), as well as the impact 
of certain amendments to the criminal code raise serious concerns about the robustness 
of  Slovakia’s  anti-corruption  framework  as  well  as  the  degree  of  specialisation  and 
institutional capacity built over time. As a consequence, the efforts of the police force 
and prosecution to investigate and prosecute complex and high-level corruption were 
seriously  disrupted,  with  impact  on  the  effective  follow-up  of  ongoing  and  future 
cases.  These  developments  risk  hampering  Slovakia’s  business  and  regulatory 
environment, and hence its competitiveness. 

(31)  Slovakia’s  digital  infrastructure  presents  a  barrier  to  its  competitiveness,  with  only 
69.12% of households covered by very high-capacity networks in 2023, compared to 
the EU average of 78.81%. The estimated investment gap of over EUR 500 million for 
gigabit  connectivity needs  to  be addressed to  provide businesses  and the public with 
faster, more reliable, and more widespread digital connectivity. To facilitate the roll-
out of new digital infrastructure, it is essential to streamline the regulatory framework, 
creating  a  favourable  business  environment  for  investors  and  reducing  the  time  and 
cost associated with rolling out digital infrastructure. 

(32)  The slow adoption of digital technologies in Slovakia presents  a further challenge to 
competitiveness  and  growth,  with  only  62%  of  small  to  medium-sized  enterprises 
(SMEs)  reaching  basic  digital  intensity,  compared  to  the  EU  average  of  72.9%.  The 
limited collaboration between the business and research sectors is a further significant 
obstacle to economic growth and competitiveness. Opportunities for SMEs to invest in 
R&D  are  limited,  as  the  current  R&D  tax  incentive  scheme  is  biased  towards  larger 
companies.  Improving  R&D  incentive  schemes  and  gearing  R&D  policies  more 
towards SMEs could foster Slovakia’s growth potential. 

(33)  Slovakia’s  economy,  including  the  large  and  labour-intensive  industrial  sector,  faces 
challenges  in  modernising,  meeting  climate  objectives,  and  remaining  competitive. 
The  domestic  manufacturing  capacity  remains  particularly  limited  in  the  net-zero 
technologies  sector.  By  shifting  towards  a  more  diversified  and  innovation-driven 

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economy,  including  towards  green  technologies  and  automated  processes,  Slovakia 
could  boost  its  long-term  economic  sustainability  and  resilience  against  external 
shocks. To this end, investments need to be clearly prioritised. The existing legislative 
framework facilitating the transformation of Slovak industry could be complemented 
by a mechanism that would regularly review and encourage the priority actions for the 
industrial  sector,  further  supporting  its  transition  particularly  towards  net-zero  and 
innovative technologies.  As the Slovak economic model  is  predominantly relying  on 
downstream  assembly  of  imported  intermediate  goods,  this  limits  domestic  value 
added  and  spillovers  of  expertise  to  local  firms.  Further  efforts  are  needed  to 
strengthen  the  integration  of  the  manufacturing  and  emerging  industrial  sectors  into 
EU-wide supply chains. 

(34)  Slovakia continues to heavily rely on Russia for fossil fuels. In 2024, around 70% of 
natural  gas  and  more  than  80%  of  crude  oil  consumed  was  of  Russian  origin. 
Slovakia’s efforts to shift away from Russian dependence are slow. 

(35)  The  high  energy  costs  for  businesses  remain  one  of  the  main  competitiveness 
bottlenecks  in  Slovakia,  while  regulated  energy  prices  for  households  continue  to 
hinder the incentives to invest in energy efficiency. In 2024, renewables contributed to 
only  24%  of  gross  final  energy  consumption,  well  below  the  EU  average  of  47%. 
Although  Slovakia  has  recently  adopted  reforms  supporting  the  deployment  of 
investments  in  line  with  REPowerEU  objectives,  further  efforts  are  needed  to 
accelerate the roll-out of renewable energy sources, including wind, solar, geothermal 
and  renewable  gases.  At  the  same  time,  the  connection  of  renewables  to  the  grid 
should  be  made  more  efficient  and  less  burdensome,  including  by  prioritising 
investments  facilitating  grid  connection  and  flexibility.  Decarbonising  the  domestic 
heating sector remains crucial for reducing the economy’s reliance on fossil fuels and 
meeting  the  country’s  climate  goals.  Geothermal  and  heat  pump  technologies  are 
particularly underused in the large district heating networks. Further efforts improving 
energy  efficiency  are  needed,  for  example,  in  the  buildings,  transport  and  industry 
sectors, as challenges in terms of timely implementation and scale-up of investments 
persist both in the public and private sectors. 

(36)  The  very  low  penetration  of  zero-emission  mobility  in  Slovakia  limits  the  domestic 
competitiveness of the country’s large automotive industry. This is exemplified by one 
of  the  lowest  percentages  for  new  registrations  of  zero-emission  vehicles  in  the  EU 
(only 2.9% of new car registrations), but also by the lagging roll-out of zero-emission 
charging  and  refuelling  infrastructure.  Although  Slovakia  has  adopted  some  reforms 
under its recovery and resilience plan (e.g. electromobility action plan), incentives to 
support  the  roll-out  of  zero-emission  vehicles  and  infrastructure  have  not  yet 
materialised.  The  roll-out  of  incentives  outlined  in  the  electromobility  action  plan  is 
crucial  in  order  to  allow  the  private  sector  to  make  significant  further  investments. 
Similarly,  Slovak  railway  transport  infrastructure  is  only  being  slowly  modernised, 
limiting  its  attractiveness  for  both  passenger  and  commercial  use.  Furthermore, 
Slovakia lacks a centralised approach for long-term funding for strategic renovations 
of  the  national  transport  infrastructure,  for  example,  through  a  dedicated  centralised 
fund for transport infrastructure to accelerate national medium and long-term funding. 
Also,  the  governance  of  the  national  rail  infrastructure  does  not  incentivise  rapid 
upgrades of the existing network. 

(37)  Slovakia is far from reaching the 2035 landfilling of municipal waste target. Improved 
resource waste management to curb landfilling and increased use of circular materials 
is  needed.  The  quality  of  Slovak  surface  water  bodies  is  deteriorating  due  to 

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inadequate  water  management  measures.  These  water  bodies  have  been  put  under 
pressure due to an increased number of extreme weather events, excessive amounts of 
pollutants and frequent changes to the shape and flow of water bodies.  However, the 
water body status could be improved and water resilience against droughts and floods 
strengthened  by  means  of  introducing  better  sustainable  water  management.  In 
the 
addition,  prioritising  nature-based  solutions  and  river  restorations  over 
construction of new water dams  and other  ‘grey infrastructure’ is  critical, while also 
translating  these  actions  into  relevant  national  policies.  Slovakia’s  carbon  removals 
fall short of the level of ambition needed to meet its 2030 targets for land use, land-use 
change and forestry. Increasing the capacity of carbon removals and the resilience of 
Slovak  forests  requires  better  protection  of  biodiversity,  in  particular  through 
finalising 
the  planting  of  multispecies  and 
multigenerational forests, and the conservation of natural resources. 

the  zonation  of  national  parks, 

(38)  Slovakia  has  a  relatively  low  unemployment  rate,  but  long-term  and  youth 
unemployment  remain  high,  as  well  as  unemployment  among  disadvantaged  groups 
such  as  Roma  and  people  with  lower  levels  of  skills.  At  the  same  time,  while  the 
gender  employment  gap  in  Slovakia  is  relatively  low  compared  to  the  EU  average, 
women  are  largely  underrepresented  in  the  job  market.  Efforts  to  increase  the 
participation of women in the labour market could help address the increasing labour 
shortages.  Investment  in  policies  to  help  vulnerable  groups  of  people  find  or  stay  in 
work  in  order  to  maintain  their  participation  in  the  job  market  remains  low. 
Participation  in  the  job  market,  especially  for  women,  is  also  hindered  due  to 
insufficient  availability  and  use  of  affordable  high-quality  early  childhood  education 
and care services, especially for children under the age of 3. Opportunities for flexible 
work  arrangements  are  also  limited,  whereas,  for  example,  supporting  part-time 
employment could increase the participation of parents of young children in the labour 
market.  

(39)  Slovakia  faces  significant  skills  mismatches,  due  to,  among  other  things,  the  lack  of 
workers with green and digital skills. This calls for significant and targeted upskilling 
and reskilling efforts. The country has a low number of ICT specialists and a low share 
of  students  who  are  enrolled  in  STEM  programmes.  At  the  same  time,  the  Slovak 
education system faces multiple challenges including teacher shortages and a need for 
teacher  training  programmes,  long-term  underfunding,  low  basic  skills  performance 
among  students  and  adults.  Since  2020,  the  risk of  poverty  and  social  exclusion  has 
been rising. Slovakia’s child poverty rate surpassed the EU average in 2023 and while 
the  child  poverty  rate  improved  in  2024,  it  remains  high  and  significant  regional 
disparities  persist,  particularly  in  the  country’s  eastern  region.  While  measures 
supported by the recovery and resilience plan, the European Social Fund Plus and the 
European  Regional  Development  Fund  aim  to  reduce  the  segregation  of  Roma  in 
education  and  ensure  equal  and  inclusive  access  to  quality  education  at  all  levels, 
capacity  at  local  level  for  implementation  is  lagging  behind,  in  particular  regarding 
infrastructure projects. 

(40)  The resilience of Slovakia’s healthcare system is under pressure due to a shortage and 
ageing  of  healthcare  professionals.  Staffing  levels  are  below  the  EU  average  and 
nearly  a  quarter  of  nurses  are  nearing  retirement.  The  limited  efforts  to  boost 
enrolment 
improve  working  conditions,  and  modernise 
infrastructure  put  further  strain  on  the  system’s  capacity.  Structural  inefficiencies  in 
hospitals and persistent underfunding, particularly in preventive care, which received 
only  2.0%  of  total  health  expenditure  in  2022,  exacerbate  the  situation.  Financial 

in  medical  studies, 

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(41) 

(42) 

difficulties  have  led  to  significant  debt  and  long  payment  delays  in  major  state 
hospitals, undermining efforts to improve efficiency. The recovery and resilience plan 
has  contributed  to  some  improvements  in  access  to  healthcare  services  and  better 
coordination  across  care  levels.  However,  further  efforts  are  needed  to  strengthen 
primary care provision and to ensure an adequate supply of critical medical products 
and infrastructure. In addition, long-term care services continue to be underfunded and 
remain rather limited, especially for vulnerable groups. Due to the ageing population, 
the  healthcare  and  long-term  care  systems  face  fiscal  sustainability  challenges  in  the 
medium and long term. 

In view of the close interlinkages between the economies of euro-area Member States 
and  their  collective  contribution  to  the  functioning  of  the  economic  and  monetary 
union,  in  2025,  the  Council  recommended  that  the  euro-area  Member  States  take 
action,  including  through  their  recovery  and  resilience  plans,  to  implement  the  2025 
Recommendation  on  the  economic  policy  of  the  euro  area.  For  Slovakia,  the 
recommendations  (2),  (3),  (4),  (5)  and  (6)  help  implement  the  first  euro-area 
recommendation  on  competitiveness,  while  recommendations  (1),  (5)  and  (6)  help 
implement  the  second  euro-area  recommendation on resilience,  and  recommendation 
(1),  (3)  and  (6)  helps 
third  euro-area  recommendation  on 
the 
macroeconomic and financial stability set out in the 2025 Recommendation. 

implement 

In light of the Commission’s in-depth review and its conclusions on the existence of 
imbalances,  recommendations  under  Article 6  of  Regulation  (EU)  No 1176/2011  are 
reflected  in  recommendations  (1),  (2),  (3)  and  (5)  below.  Policies  referred  to  in 
recommendation (1) help to  address  vulnerabilities linked to the housing market  and 
household debt. Policies referred to in recommendation (1), (2) and (5) help to address 
vulnerabilities linked to external balances. Policies referred to in recommendation (1), 
(3)  and 
to  competitiveness. 
Recommendations  (1),  (2),  (3)  and  (5)  contribute  to  both  addressing  imbalances  and 
implementing  the  Recommendation  on  the  economic  policy  of  the  euro  area,  in  line 
with recital 41. 

to  address  vulnerabilities 

(5)  help 

linked 

HEREBY RECOMMENDS that Slovakia take action in 2025 and 2026 to: 

1. 

Reinforce overall defence spending and readiness in line with the European Council 
conclusions  of  6  March  2025.  Adhere  to  the  maximum  growth  rates  of  net 
expenditure  recommended  by  the  Council  on  21  January  2025,  with  a  view  to 
bringing  an  end  to  the  situation  of  an  excessive  deficit  while  making  use  of  the 
allowance under the national escape clause for higher defence expenditure. Make the 
tax mix more efficient, including by reducing disincentives in the labour market, and 
making stronger use of  taxes less detrimental  to  growth  such as  environmental  and 
recurrent  property 
taxation.  Improve  spending  efficiency  by,  for  example, 
implementing spending reviews. Continue to strengthen tax compliance, including by 
further digitalising the tax administration. Wind down the emergency energy support 
measures  in  force  and  ensure  that  these  are  targeted  at  protecting  vulnerable 
households and firms, and are fiscally affordable, and preserve incentives for energy 
savings.  Support  housing  supply  and  expand  the  rental  market  by  accelerating 
residential  construction  and  by  promoting  social  housing,  taking  into  account 
regional disparities. 

2. 

In  view  of  the  applicable  deadlines  for  the  timely  completion  of  reforms  and 
investments  under  Regulation  (EU)  2021/241,  accelerate  the  implementation  of  the 
recovery  and  resilience  plan,  including  the  REPowerEU  chapter.  Accelerate  the 

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3. 

4. 

5. 

implementation  of  the  cohesion  policy  programme  (ERDF,  JTF,  ESF+,  CF), 
building,  where  appropriate,  on  the  opportunities  offered  by  the  mid-term  review. 
Make optimal use of EU instruments, including the scope provided by InvestEU and 
the Strategic Technologies for Europe Platform, to improve competitiveness. 

Ensure a favourable business environment by creating a more predictable regulatory 
environment,  through  improving  the  better  regulation  framework,  ensuring  that 
impact  assessment  and  stakeholder  consultations  are  integrated  into  the  legislative 
process. Address the fragmentation of governance structures, including by preparing 
a  reform  of  the  local  governance.  Ensure  quality  public  services  through  better 
coordination  and  policymaking.  Ensure  transparency  and  competition  in  public 
procurement processes to promote good governance and improve the effectiveness of 
public spending, and increase the use of quality-related and life cycle cost criteria in 
public  procurement  operations.  Strengthen  the  judicial  system  and  enhance  the 
effectiveness  of  the  anti-corruption  system,  including  by  ensuring  adequate, 
autonomous  and  effective  investigations  and  prosecutions  of  high-level  corruption 
cases and sufficient, specialised capacity at police and prosecution level.  

Bolster  digital  infrastructure  by  closing  the  investment  gap  for  gigabit  connectivity 
and streamlining regulation for infrastructure roll-out. Increase the adoption of digital 
technologies,  particularly  among  SMEs,  by  removing  bottlenecks  in  their  roll-out. 
Improve  research  and  innovation  policy  by  incentivising  collaboration  between 
business  and  the  research  sector  and  by  revising  the  R&D  tax  incentive  scheme  to 
provide greater support to SMEs. 

Prioritise investments in clean and efficient production and in the use of energy and 
resources.  Strengthen  the  legislative  framework  to  support  green  technologies  and 
products,  and  promote  investments  to  advance  industrial  competitiveness  and 
economic diversification. Accelerate the diversification of fossil fuel supply to phase 
out  dependence  on  Russian  sources.  Accelerate  the  roll-out  of  renewables,  while 
making the procedures for connecting renewables to the grid more efficient and less 
burdensome. Support further investments in grids, in particular electricity networks, 
as well as in decarbonisation of the heating sector. Support further roll-out of zero-
emission mobility  and modernisation of the rail network, by reforming the national 
railway  infrastructure  governance  and  creating  a  dedicated  investment  framework. 
Strengthen resource waste management and reuse of municipal and packaging waste, 
the conservation of natural resources, and increase water resilience by mainstreaming 
nature-based solutions and finalising the zonation of nature-protected areas. 

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6. 

Strengthen the labour market participation of underrepresented groups, and introduce 
more flexible work arrangements for parents with children.  Increase the availability 
and  use  of  affordable  high-quality  early  childhood  education  and  care  for  children 
under  the  age  of  3.  Strengthen  the  teaching  of  basic  skills,  including  for  children 
from disadvantaged backgrounds notably in marginalised Roma communities, while 
ensuring equal and inclusive access to quality education at all levels. Step up policy 
efforts  aimed  at  the  provision  and  acquisition  of  skills  and  competences,  by 
providing  reskilling  and  upskilling  opportunities  for  adults,  investing  in  teacher 
training,  and  increasing  enrolment  in  STEM  education  programmes.  Improve 
primary  care  provision,  especially  for  vulnerable  people,  and  expand  preventive 
healthcare  measures.  Strengthen  the  resilience  of  the  health  system  in  the  areas  of 
critical  medical  products,  infrastructure,  and  healthcare  workforce  by  retaining  and 
attracting  skilled  workers,  while  ensuring  the  fiscal  sustainability  of  the  healthcare 
system. Ensure affordable and quality long-term care. 

Done at Brussels, 

For the Council 
The President 

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