Finance Minister Mihaly Varga (Photo: MTI / Tibor Illyés)

Hungary budget deficit HUF 539.7 bn in January-February

Hungary's cash flow-based budget deficit, excluding local councils, was 539.7 billion forints (EUR 1.46bn) at the end of February, the finance ministry said in a preliminary report on Monday. The ministry said the deficit was the result of "measures taken so far and pandemic expenditures".

“The resources necessary for [pandemic] defence, such as the procurement of vaccines, and for restarting the economy continue to be available in the budget,” the ministry added.

The central budget ran a 505.5 billion forint deficit, while separate state funds had a 13.4 billion surplus and the social insurance funds were 47.6 billion in the red at the end of February.

The deficit swelled after running a 198.8 billion forint surplus at the end of January, the ministry said.

Government payouts linked to projects which receive EU funding came close to 481 billion forints in January-February, while transfers from Brussels came to 128.8 billion.

The ministry said that spending in January-February included 57.4 billion forints on road developments, 50.7 billion forints on competitiveness-boosting subsidies, 42.0 billion on the Modern Cities Programme, 38.8 billion on public transport projects and 28.7 billion on the Healthy Budapest Programme.

It added that spending was also impacted by the first tranche of an annual pensioners’ bonus the government is reintroducing, the extension of a wage support programme for businesses impacted by pandemic restrictions and the launch of a scheme that will raise the salaries of doctors over several years.

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