Promoting economic growth and bolstering the status of enterprises and families have been in the focal point of Government measures. And the funds required for this purpose are available while fiscal stability has been maintained.

In the initial eight months of the year, the central sub sector of the state budget has accumulated a deficit of HUF 979.9bn. Within that, the central budget and Social Security Funds had deficits of HUF 1019.0bn and HUF 71.7bn, while Extra-Budgetary State Funds posted a surplus of HUF 110.8bn. In the month of August, the central sub sector showed a deficit of HUF 163.1bn. In comparison: in the the period January-August 2016, the accumulated deficit was HUF 274.0bn.

The difference between the balances of this year and last stems from various processes observed in recent months. On the revenue side, the positive results of the six-year wage agreement concluded in last November have become clearly visible. The number of people in employment is at a record high of 4 million 434 thousand, while the unemployment rate has declined to 4.2 percent. Thanks to rising wages and family policy incentives, revenues related to employment and consumption continued to rise substantially despite lower corporate tax rates.

On the expenditure side, payments related to EU-funded projects grew further, to HUF 1324.6bn, almost double the figure registered in the corresponding period of the previous year. In order to assist the timely and successful implementation of these projects, EU grants are prepaid from the state budget. However, the funds received from the EU have hitherto been much smaller.

Housing subsidies paid to families were up by 33.8 percent year-on-year. In order to ease the financial burden posed by a new school year, the transfer of family benefits (which total HUF 33bn per month) – among them family allowance – was brought forward to August.

The ESA deficit target of 2.4 percent of GDP continues to be reasonable and safely obtainable.

(Ministry for National Economy)