Stable governance in uncertain times

“The revised national budget underscores the government's top priority of ensuring economic stability. A new and more challenging geopolitical situation, along with ongoing trade conflicts, creates significant global uncertainty. This makes responsible governance even more important," said Minister of Finance Jens Stoltenberg.

Greater uncertainty and trade conflicts may result in slower economic growth and higher inflation in many countries. Domestically, low unemployment, continued job growth, and solid real wage increases suggest the economy will expand further.

"Reduced global trade contributes to lower global growth, which also impacts the Norwegian economy. However, we still expect growth to pick up, with unemployment remaining low. Our job now is to safeguard the country, welfare, and people's finances," said Stoltenberg.

In the revised budget Fund spending is estimated at NOK 542 billion, corresponding to 2.7 per cent of the Government Pension Fund Global's value at the beginning of the year—well below the expected real return of 3 per cent, which forms the basis of the fiscal rule.

In April the Norwegian Parliament unanimously decided to increase military support to Ukraine by NOK 50 billion, which will be used in its entirety to provide military support through international initiatives and procurements from the Ukrainian defence industry. This is not expected to affect the activity level in the Norwegian Economy. Excluding the increased support for Ukraine, Fund spending is estimated at NOK 492 billion, which is at same level as in the 2025 budget passed before Christmas. This results in a fiscal impulse of 1.3 per cent and a structural non-oil fiscal deficit of 11.7 per cent of GDP for mainland Norway, which is also unchanged from the budget passed before Christmas.

Changes to the budget

The revised national budget presents updated estimates for expenditures, revenues, and other necessary adjustments, including new projections for national insurance. The government also proposes several additional allocations to follow up on previously announced and approved measures, including increased support for Ukraine and a fixed electricity price for Norwegian households:

• NOK 50 billion in increased military support for Ukraine.
• Increased municipal transfers to cover increased pension costs due to the new public contractual pension scheme (offentlig avtalefestet pensjonsordning).
• Higher expenses under national insurance based on updated estimates.
• Fixed electricity price scheme for households and holiday home owners – a fixed price of NOK 0.4 per kilowatt-hour (kWh) excluding VAT and other taxes from 1 October 2025, along with support measures for district heating.
• Reduced electricity tax by NOK 0.44 per kWh from 1 July, with the aim to abolish the Enova levy from 1 January.
• Additional defence budget increases to establish a temporary NATO air operations centre.
• Lower expenses for reception and integration of refugees due to lower forecasts for refugee arrivals.

Table 1: Key figures for the Norwegian economy. Percentage volume change from previous year, unless otherwise stated	NOK billion1		Forecasts
	2024	2024	2025	2026
Private consumption	2 043	1.2	2.1	2.4
Public consumption	1 184	2.4	3.1	1.2
Gross fixed investments	1 137	-1.9	0.2	1.3
Of which: Petroleum extraction and      pipeline transportation	253	9.6	1.0	-8.0
Businesses in mainland                            Norway	423	-3.3	2.5	2.9
Housing	170	-19.1	-6.5	12.0
Public sector	285	3.5	0.1	0.5
Aggregate demand, mainland Norway2	4 105	0.2	1.9	2.4
Of which: Public sector demand	1 469	2.6	2.5	1.1
Exports	2 472	5.7	-1.1	1.1
Of which: Crude oil and natural gas	1 176	7.5	-3.3	0.4
Goods and services, excl. oil                    and gas	1 121	3.7	2.6	1.7
Imports	1 750	3.7	2.2	2.5
Gross domestic product	5 198	2.1	0.0	1.2
Of which: mainland Norway	4 050	0.6	1.8	1.6
Other key figures:
Employment		0.6	0.7	0.7
Unemployment rate, LFS (level)		2.0	2.1	2.1
Unemployment rate, registered (level)		4.0	4.1	4.1
Annual wage growth		5.6	4.4	4.0
Consumer price inflation (CPI)		3.1	2.8	2.6
Underlying inflation (CPI-ATE)		3.7	3.0	2.6
Crude oil prices, USD per barrel (current prices)		80	70	67
Natural gas prices, USD per MMBtu (current prices)		10.8	13.0	10.2
Three-month money market rate, pct		4.7	4.5	3.8
Import-weighted exchange rate (I-44) 3		0.8	0.1	-0.3
GDP trading partners4		1.6	1.7	1.8
CPI trading partners5		2.8	2.6	2.2

¹ Provisional national account figures at current prices.

² Excluding inventory changes.

³ Positive figures indicate a depreciation of the NOK.

⁴ Norway's 25 most important trading partners weighted by respective shares of Norwegian exports, excluding oil and gas.

⁵ Norway's 25 most important trading partners weighted by respective shares of Norwegian goods imports excluding ships, oil platforms and crude oil.

Sources: Statistics Norway, OECD, IMF, foreign central banks, national sources, Norges Bank, the Norwegian Labour and Welfare Administration, Reuters and the Ministry of Finance.

 

Table 2 Key figures for the fiscal budget for 2025. Projections made at different times.1	NB25	Balanced	RNB25	Change from balanced
Non-oil fiscal deficit, NOK billion	413,6	445,8	493,8	47,9
Structural non-oil fiscal deficit, NOK billion	460,1	492,3	542,4	50,2
Per cent of trend GDP for mainland Norway	10,9	11,7	12,9	1,2
Per cent of Fund capital	2,5	2,7	2,7	0,1
Fiscal impulse, percentage points2	0,5	1,3	2,5	1,2

¹ National budget 2025 (NB25), Balanced budget 2025 adopted autumn 2024 (Balanced) and Revised national budget 2025 (RNB25).

² Change in structural non-oil fiscal deficit as share of trend GDP for mainland Norway. Change in structural non-oil fiscal deficit as a share of trend GDP for mainland Norway. Positive numbers indicate an expansionary fiscal stance. The indicator does not take into consideration that different revenue and expenditure items may differ in their effect on economic activity.

Source: Ministry of Finance. 

 

Tabell 3 Key figures for the fiscal budget and the Government Pension Fund. NOK billion	Accounts		Estimate
	2023	2024		2025
Total revenues	2 494.4	2 323.8		2 310.3
1   Revenues from petroleum activities	1 008.5	750.7		731.1
1.1   Taxes	623.2	420.3		405.7
1.2   Other petroleum revenues	385.2	330.3		325.4
2   Non-oil revenues	1 485.9	1 573.1		1 579.2
2.1   Taxes from mainland         Norway	1 352.1	1 397.8		1 417.1
2.2   Other revenues	133.8	175.3		162.1
Total expenditure	1 806.8	1 953.3		2 105.9
1   Expenditure on petroleum activities	30.4	48.5		33.0
2   Non-oil expenditure	1 776.4	1 904.8		2 073.0
Fiscal budget surplus before transfer to the Government Pension Fund Global	687.6	370.5		204.3
-    Net cash flow from petroleum revenues	978.1	702.2		698.1
=   Non-oil fiscal surplus	-290.5	-331.7		-493.8
+   Transfer from the Government Pension Fund Global	286.2	346.5		493.8
=   Fiscal surplus	-4.2	14.7		0.0
+   Net provision for the Government Pension Fund Global	691.8	355.7		204.3
+   Interest and dividend income, etc., in the Government Pension Fund1	354.9	422.1		472.9
=   Combined surplus in the fiscal budget and the Government Pension Fund1	1 042.5	792.6		677.2
Memo:
Interest and dividend income, etc., on the Government Pension Fund Global	338.6	402.8		452.7
Market value of the Government Pension Fund Global2	12 413	15 761		19 735
Market value of the Government Pension Fund2	12 732	16 115		20 116
Non-oil fiscal deficit, NOK billion	290.5	331.7		493.8
Structural non-oil fiscal deficit, NOK billion, fixed 2025-pricess	389.3	429.7		542.4
Structural non-oil fiscal deficit, NOK billion	360.2	415.1		542.4
Per cent of trend GDP for             mainland Norway	9.5	10.3		12.9
Per cent of Fund capital	2.9	2.6		2.7
Fiscal impulse, percentage   points3	0.4	0.9		2.5
Real underlying expenditure   growth, per cent	2.4	3.1		5.3

¹ Does not include foreign exchange gains or losses.

² At the beginning of the year. For the Government Pension Fund Global, the number differs from Norges Bank’s annual reports. The number reported in the table is less accrued, unpaid management fees and the Treasury’s claims against the Fund.

³ Change in structural non-oil fiscal deficit as a share of trend GDP for mainland Norway. Positive numbers indicate an expansionary fiscal stance. The indicator does not take into consideration that different revenue and expenditure items may differ in their effect on economic activity.

Sources: The Ministry of Finance and Statistics Norway.