General gov’t deficit reaches 103% of full-year target
Hungaryʼs cashflow-based general government deficit, excluding local councils, reached HUF 914.9 bln at the end of August, or 102.5% of the HUF 892.4 bln full-year target, a first reading of data released by the National Economy Ministry on Monday shows, according to state news agency MTI.
The deficit was up from HUF 858.8 bln for the same period a year earlier, a difference the ministry attributed to a HUF 370 bln decline in European Union funding. The ministry noted that, in addition to the usual year-to-year differences in accounting the funding, the transfer of some funding was held up due to a European Commission probe.
The EC interrupted the equivalent of €451 mln in payments for Hungarian projects a year ago, after an audit "revealed systemic weaknesses in the project selection system", Hungarian news agency MTI reported earlier. The funding was suspended in April of this year.
The ministry said in its release on Monday that the suspended funding would show up later on the general governmentʼs cashflow-based accounting, but would not affect the balance calculated according to the EUʼs accrual-based rules. The full-year deficit target of 2.4% of GDP, calculated with EU rules, remains attainable, the ministry said.
In January-August, the central budget ran a HUF 980.2 bln deficit, while the social security funds and separate state funds had surpluses of HUF 33.7 bln and HUF 31.6 bln, respectively. In August alone, the general government deficit came to HUF 20.8 bln, over the HUF 7.4 bln gap in the base period because of the early transfer of HUF 34.5 bln of social subsidies for the month of September with the aim of making the start of the school year easier for Hungarian families, the ministry said.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.