Conservative projections show that interest expenditures may be HUF 30-40bn lower compared to former estimates, Minister of State for Public Finances Péter Benő Banai said at a meeting with financial experts, adding that yields of government securities are already much lower now.

Speaking about the timing of submitting the budget bill which is planned already in spring, he reiterated that both the Convergence Programme and the budget bill will be made public at the end of April.

In the Ministry’s estimate, Hungary’s macro path in 2015 will be more favourable than the current Government prognosis, but the earliest date for modifying the general government budget deficit figure of 2.4 percent may be the end of April. This indicator is likely to be lower than the 2.9 percent prior estimate, but higher than 2.2 percent anticipated by the National Bank of Hungary for 2014. Péter Benő Banai also said that the general government debt-to-GDP ratio is expected to be lower than the 77.3 percent figure of 2013.

Minister of State for Taxation and Financial Affairs Gábor Orbán pointed out that the Government is not expecting “any extra points” from credit rating agencies for submitting the budget bill earlier. He stressed that the draft is to take into account the effect stemming from the planned lowering of bank tax and an economic growth figure set to be higher than former estimates, ranging between 2.5-3 percent.

The Ministry also released detailed fiscal data for the second month of the year. These show a HUF 256.9bn deficit in the central sub sector of the state budget, well below the HUF 407.9bn shortfall registered in the same month of the previous year. This positive development has been mainly the result of higher tax revenues generated by stronger economic growth and a sounder interest rate level.

(Ministry for National Economy)