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Hungary’s budget runs EUR 3.2b deficit at end of August

Hungary’s budget runs EUR 3.2b deficit at end of August

 

BUDAPEST: Hungary’s cash flow-based budget deficit, excluding local councils, was at 979.9 billion forints (EUR 3.2bn) at the end of August, preliminary data released by the Economy Ministry on Thursday show. The deficit reached 84 percent of the 1,166.4 billion forint full-year target. The central budget had a 1,019.0 billion forint deficit and the social insurance funds were 71.7 billion forints in the red at the end of August. The separate state funds ran a 110.8 billion forints surplus. In August alone, the budget, ran a 163.1 billion forint deficit. The eight-month deficit was up from a 274.0 billion forint deficit in the base period. The ministry said revenues connected to employment and consumption were up markedly in August compared with the same month last year because of higher wages and government support given to families. It cited the positive effect on incomes of an agreement reached late last year between the government, employers and unions on raising the minimum wage of skilled and unskilled workers. On the expenditures side, advanced payments from domestic funds for EU tenders raised spending. Advanced payments came to 1,324.6 billion forints in January-August, almost double compared with the base period, the ministry said. Government subsidies for families building homes were up 33.8 percent compared with the base period and family subsidies payments scheduled for September were brought forward to August to help families prepare for the start of the school year. The latter raised expenses by 33 billion forints. The deficit target of 2.4 percent of GDP for the full year calculated according to EU accounting rules “can be safely achieved”, the ministry said.