The delays with which the state gives the money it owes to households and businesses, either in the form of unpaid obligations and pensions, or as tax refunds that are overdue, are once again becoming a “drag” on the economy and businesses.

According to new data from the General Accounting Office for February, the total government “account” overdue debts in the market exceeded 3.65 billion euros, having increased by more than half a billion since the beginning of the year and depriving the real economy of valuable liquidity.

“Big patient” hospitals

The “x-ray” of state debts, based on June data, shows that the main problem is mainly in the debts of hospitals which are – by a huge margin – the biggest “bad payer” in the market!

Despite the rapid increase in their funding every year, hospitals continue to increase the “debt” to their suppliers, which has now reached 1.6 billion (1.599 billion to be precise), i.e. almost half of the total outstanding debts of the state!

However, in addition to bureaucratic delays, these amounts have not yet been offset against suppliers’ rebate and clawback obligations. That is, the “statutory” tariffs imposed by the state on doctors, clinics, laboratories, pharmacies, etc., thanks to which the state ultimately “cuts” its debts to health care suppliers towards the end of the year, have not been deducted.

And overall, however, the data of the General Accounting Office show that the overdue liabilities of all general government agencies (i.e. the direct debts of the entire public sector which are overdue by more than 90 days from the payment date) are constantly increasing and amounted to 2.93 billion euros by the end of June.

Of these, 2.32 billion is a “legacy” of 2024 and the remaining 600 million are new “debts” that arose in the first half of 2025.

In addition, to this 2.93 billion, 722 million euros from pending tax refunds are added, bringing the “bill” to 3.65 billion in total. In contrast to the public arrears, however, tax refunds have seen a drop rather than an increase over the year: although the outstanding tax arrears in January stood at €915 million, the picture has improved dramatically since February and has fallen by almost 20% so far.
The situation has improved dramatically from the beginning of the year to the present day and has now been reduced by almost 20% since then.

Who and where they owe

The insurance funds are the second largest government debtor. The outstanding debts of the social security organisations (SSIs) mainly concern outstanding pension payments and have increased to €612 million. Among them, EOPYY owes 255 million euros, mainly to private health care providers.

Local government: Municipalities and regions leave unpaid bills of €264 million. Since the beginning of the year they have increased by 33 million euros.

Ministries: The debt of the “narrow” public sector, i.e. ministries and their directly supervised bodies, is comparatively lower, with €232 million in arrears. The public sector has 232 million euro of this amount. In fact, 208 of the 232 million euros are in arrears for the Public Investment Programme (PIP) and another 24 million euros for the Regular Budget.

Other Legal Entities: Other central government entities owe 222 million euros, up from 249 million euros in May and about 200 million euros at the beginning of the year

“Crossword puzzle” of tax refunds

However, as far as pending tax refunds are concerned, which stood at 722 million euros at the end of June, the picture is more complex:

– overall, outstanding tax refunds increased by €72 million in one month to €722 million in June from €650 million in May.

– Only 330 million euros relate to refunds that are more than 90 days overdue and for which the delay is due to the tax office.

– a very large part, amounting to EUR 200 million, is overdue (more than 90 days), but its payment has been “blocked” for reasons beyond the State’s control! For example, the beneficiary may not have provided the necessary supporting documents or not responded to notices etc.

– The remaining 392 million euros are pending refunds, but these are still within the normal period (less than 90 days) from the day the state’s obligation to return them to the beneficiaries was cleared.