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Public Finances Upside Down: Several Sectors Received More than Expected Last Year

Ábrahám Vass 2021.10.16.

Almost every aspect of the budget has increased more than originally planned last year, Hvg.hu reports after checking the final accounts bill. Besides healthcare and the economy, sports and churches have also received a lot more funds than originally planned.

Each appropriation has to be labeled in the budget as to which government function it is allocated to, which makes it possible to see roughly how much money has been spent on each government function in the previous year, what proportion of total government spending it represents, and how it relates to the GDP.

Unsurprisingly, the coronavirus pandemic has turned public finances upside down. The state has spent more than originally planned on almost every function. Added to a shrinking GDP, this has eventually resulted in an increase in the public debt, which has eventually gone up to 80% of the gross domestic product.

  • Expenditure in the functional group of other economic activities increased by 80%, from HUF 1.1 trillion (EUR 3,1 billion) to HUF 2.1 trillion (EUR 5.8 billion).
  • Health-related expenditures have undergone the second largest increase as a functional group as it increased by one and a half times the planned amount. In addition, this has been the largest increase in absolute value, as an extra HUF 1,000 billion (EUR 2.8 billion) has been spent in this field.
  • Third place went to the main sectors of entertainment, cultural, religious activities and services. This category also includes party activities, which received less money than planned in 2020 after the government decided to halve party funding due to the epidemic. So expenditures jumped from HUF 1.1 trillion (EUR 3,1 billion) to HUF 1.7 trillion (EUR 4.7 billion).

In an interesting feature, highlighted by HVG, the state hasn’t cut back on churches either. To the contrary: instead of the originally planned HUF 73 billion (EUR 203 million), it allocated some HUF 229 billion (EUR 636 million) for religious activities.

Similarly, sports received some HUF 528 billion (EUR 1.47 billion) instead of 292 billion (EUR 811 million), which is almost double the expected amount.

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The liberal weekly notes that Hungary’s central budget is still opaque, because the government is constantly amending it even before it comes into effect, among other reasons. In fact, even the final accounting of the budget’s implementation are always full of questions. For example, the government has allocated funds from the HUF 1 trillion epidemic control budget through non-public, individual decisions- and the final accounts fail to reveal exactly for what purposes.

featured image illustration via Csaba Krizsán/MTI