2014 budget amended to accommodate assets purchases, capital injections

Telco

Parliament approved on Tuesday amendments to the 2014 Budget Act that raised the cashflow deficit by HUF 167 bln to HUF 1.156 trillion, mainly to accommodate earlier and ongoing government assets purchases or to provide fresh capital to state-owned companies, MTI reported.

The amendments, part of which were tabled by the government in June, will not affect the EU-conform deficit, targeted at 2.9% of GDP in 2014, although some of them may raise state debt, the Fiscal Council said earlier. Budget expenditure will rise in line with the cashflow deficit while net revenue will remain unchanged.

Part of the higher expenditure, namely items worth HUF 47.7 bln that would otherwise raise the ESA deficit, were counterbalanced by a similar-size reduction of the budget's National Protection Fund, to HUF 52.3 bln. The Fiscal Council earlier warned against lowering the fund, which provides a buffer against deficit overshoot risks. 

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