Hungary’s cash-based general government budget, excluding municipalities, posted a HUF 559.4bn (EUR 1.87bn) deficit in January-May 2013, accounting for 63.5% of the annual target, the economy ministry said in a statement, confirming the preliminary data. The gap widened by 62.6% from a year earlier as expenditures grew by 8.7% y/y, faster than the revenues’ annual rise of 5.4%.

The central government budget generated a deficit of HUF 727.9bn in the first five months of 2013, up by 80.4% y/y. Spending grew by 11.9% y/y and revenues were up by 4.3% y/y. Social security funds had a surplus of HUF 121.4bn in the period, as compared to a HUF 2.3bn deficit a year earlier. The surplus on the extrabudgetary accounts reached HUF 47.1bn, down by 23.8% y/y.

Hungary’s general government sector ran a deficit of HUF 532.6bn in 2012, equalling to 1.9% of the GDP, according to preliminary figures reported by the statistics office to Eurostat under the Excessive Deficit Procedure (EDP). According to the data, the government has met its deficit target, which was set at 2.7% of GDP. The European Commission recommended on May 29 lifting of the excessive deficit procedure against Hungary, concluding that the country has taken adequate adjustment measures to keep the fiscal deficit below the 3% threshold in both 2013 and 2014.