Czech Government Survives No-Confidence Vote Over Budget Deficit and PM's Conflicts

The Czech government led by Prime Minister Andrej Babiš confronted a parliamentary no-confidence vote on Tuesday, brought by opposition parties over a proposed budget deficit and lingering questions about the prime minister's business interests.

Opposition lawmakers condemned the draft 2027 budget, which projects a deficit of 386 billion koruna (about $18 billion) — the second-largest in the country's history. The current year's deficit is expected to reach 310 billion koruna.

Critics, including most economists, argue that running such a large shortfall is unwise when the economy is forecast to grow by 2.7% next year, according to the Czech central bank. The government counters that the spending is needed to fund investments and priorities such as health care, pension increases and public-sector pay rises.

Babiš, one of the wealthiest Czechs, has also faced scrutiny over a potential conflict of interest arising from his private business holdings and his political role. After his ANO (YES) movement won October's election, he transferred roughly 200 companies under the Agrofert conglomerate into an independent trust fund to comply with conflict-of-interest rules that would otherwise bar the businesses from state and European Union subsidies. His health care investments were not included in the move.

The European Commission said earlier this month that the trust fund does not adequately resolve the issue, stating that Babiš remains in a potential conflict of interest, and suspended some payments to Agrofert.

Opposition parties have further criticised Babiš for his verbal attacks on independent courts, judges and the media. He governs in coalition with two small political groups whose agenda includes reducing support for Ukraine and rejecting some key European Union policies.