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Hungary’s Budget Deficit Exceeds HUF 5,000 Billion for 2021

Hungary Today 2022.01.12.

Hungary’s cash flow-based budget deficit, excluding local councils, reached 5,101.5 billion forints (EUR 14.2bn) at the end of December, Hungarian state news agency MTI reports based on the finance ministry’s preliminary reading of data.

This annual deficit is 209.8 billion forints lower than the previous year, but more than double (223% percent) of the approximately 2,287.7 billion forints of the target in the amended central budget law.

The HUF 95 billion lower cash deficit means that the deficit-to-GDP ratio could be 0.1-0.2 percentage points lower than the 7.5 percent previously expected.

Finance Ministry Announces HUF 755 bn Expenditure Cut for 2022 Budget
Finance Ministry Announces HUF 755 bn Expenditure Cut for 2022 Budget

Among others, the spending cuts will seriously affect the opposition-led capital city, and next year's investments.Continue reading

Compared with the central subsystem deficit of HUF 3,931.3 billion at the end of November, the December deficit was HUF 1,170.2 billion, down from HUF 1,009.1 billion the previous month.

In 2021, the central budget closed with a deficit of HUF 4662.3 billion, social security funds with a deficit of HUF 419.4 billion, and separate state funds with a deficit of HUF 19.8 billion.

“The budget ensured to the fullest extent, the resources necessary to restart the economy and the defense against the pandemic,” according to a statement released by the ministry on Tuesday.

“In the interest of restarting the economy, the government continued its economic policy based on tax reductions, job creation, and the strengthening of families in 2021.

As a result, the economy may have grown by 6.4 percent, while the number of employed rose to 4.7 million and the jobless rate fell under 4 percent. Additionally, resources used for family subsidies and pensioners increased further,” the statement read.

Featured photo by Attila Kovács/MTI