Notifications of the government deficit and debt
| Notification of government deficit and debt | April 2014 |
The notification of government deficit and debt is compiled for the past four years and submitted to the European Commission by each Member State of the EU twice a year, regularly at the end of March and September, including a projection for the current year. The calculation of the requested aggregates is based on the methodology of the European System of Accounts (ESA95). Pursuant to the Maastricht criteria, the deficit and the cumulated debt should not exceed 3% of GDP and 60% of GDP, respectively.
Government surplus/deficit – EDP B.9 - refers to net borrowing (-) or net lending (+) including interest on swap transactions. It shows the ability of the general government sector to finance other entities (+) or the need of the general government sector to be financed (-) in the given year.
Government debt includes, by definition, liabilities of the general government sector resulting from currency emissions (not applicable to the CR), received deposits, issued securities other than shares (except for financial derivatives), and received loans.
Indicators given in the table were transmitted to Eurostat at the end of March 2013. Compared to the notification in September 2013, the deficit in 2012 has been revised due to refining the estimation of tax revenues of government (-0.23 percentage point of GDP).
Deficit of government institutions in 2013 has been influenced by annual growth of total revenues (about 2.4 %); at the same time, the amount of total expenditures has been reduced by almost 4 %. On the revenues side, the growth is driven by taxes collected by the government (annual growth 3 %), especially taxes on products (almost 4 %). On the expenditure side, reduced investment expenditures can be found as dominant factor (decline of 12 %).
Development of nominal government debt is significantly affected by predominantly non-debt financing of the government deficit, mainly by reduction in deposits of government institutions. In relative terms, share of the government debt to GDP has declined by 0.12 percentage point to 46.04 %.
The projection of government deficit and debt for the year 2014 is prepared and published by the Ministry of Finance of the Czech Republic.
Statement of the European Commission is expected on 23nd April 2014.
Prague, 1st April 2014