The Ministry for National Economy is expecting another amount of HUF 300bn of EU funds in the month of November 2015, and that will significantly reduce cash-flow deficit as well as the general government debt-to-GDP ratio, Minister of State for Public Finances Péter Benő Banai said at a panel discussion.

Speaking of the general state of the budget and revenues this year, he said that incoming tax revenues are significantly higher in all three major tax categories. This is attributable to the current, better-than-expected economic processes: in the budget 2.5 percent economic growth has been projected and this indicator is now seen to be around 3 percent for the whole year.

He stressed that the deficit target of 2.4 percent of GDP is clearly attainable; the budget is “on a firm footing.” He added, however, that the suspension of EU funds blew a large hole in public finances: the European Commission has held back the payment of EUR 2bn for operative programmes the financing of which are still under discussion, and that accounts for 2 percent of Hungary’s GDP.

On the other hand, as revenues in terms of several budget estimates are turning out to be higher than anticipated, this increases next year’s manouvering room. Accordingly, the Government is weighing options for boosting economic growth, improving employment and assisting families without jeopardizing budget deficit and government debt reduction targets.

(Ministry for National Economy)