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Hungary general govt deficit 110% of target in 2011

Hungary had a cash flow-based general government deficit, excluding local councils, of HUF 1,734.4bn at the end of December or 110.0% of the modified full-year target, the National Economy Ministry said in a preliminary report on Monday.

The cash flow-based deficit confirms the accrual-based target of 2.94% of GDP, excluding one-off items, will be met, the ministry said.

In December alone, the general government ran a HUF 486.5bn deficit. The central budget was HUF 422.1bn in the red, separate state funds had a HUF 11.4bn deficit and the shortfall was HUF 53.0bn for social insurance funds.

The ministry said the takeover of county governments’ debt contributed in large part to the December deficit in the form of a HUF 196bn expenditure. Additionally, about HUF 50bn in debt was taken over from state-owned railway company MAV and the state injected HUF 120bn into the Hungarian Development Bank (MFB), it added.

The ministry said about HUF 220bn in VAT refunds the state must pay under a decision by the European Court came out of the revenue side.

For the full year, the central budget ran a HUF 1,718.3bn deficit and the social insurance funds were HUF 83.3bn in the red, but separate state funds had a HUF 67.2bn surplus.

General government revenue came to HUF 13,208.9bn for the year, against expenditures of HUF 14,943.3bn.