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Gen govʼt deficit reaches HUF 2.604 tln at end-Oct

Hungaryʼs general government deficit, excluding local councils, reached approximately HUF 2.604 trillion at the end of October, the Finance Ministry said in a preliminary release of data on Monday, according to a report by state news wire MTI.

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The central budget deficit reached HUF 2.14 tln, the social insurance funds were HUF 489.9 billion in the red and separate state funds had a HUF 25.7 bln surplus.

The deficit has swelled this year because of pandemic defense spending, economic stimulus, and pre-financing for European Union-funded projects.

The deficit rose from about HUF 2.27 tln at the end of September.

The ministry said spending on medical equipment necessary for pandemic defense came to HUF 593.3 bln by the end of October.

Payouts for European Union-funded projects reached HUF 1.642 tln, while transfers from Brussels came to just HUF 997.4 bln.

The government has been pre-financing EU-funded projects for years to avoid backups and ensure all available monies are used up.

Among other expenditures, the ministry noted HUF 165 bln in business grants to boost competitiveness in the face of the coronavirus crisis, HUF 196.3 bln for tourism developments, HUF 53.5 bln for investment incentives, HUF 33.6 bln in subsidies for purchases of cars by big families, HUF 404.3 bln in spending on road construction and renovation, HUF 35.9 bln for projects undertaken in the framework of the Modern Cities Program and HUF 34 bln for projects that are part of the Hungarian Villages Program.

"The governmentʼs most important goal during the second wave of the pandemic is protecting human lives and maintaining the ability of the economy to function," the ministry said.

"Thus the central budget continues to ensure all necessary resources for health defense and economic protection measures," it added.