Secretariat of the Council for Budget Responsibility (SoCBR) estimates General Government Budget (GGB) deficit amounting to EUR 3,8 billion
• SoCBR has increased the estimated level of GGB deficit in 2022. A negative difference compared to the September forecast amounts to EUR 76 million (0.1 % of GDP). Under the assumption that the government does not take additional measures, the deficit can reach the amount of EUR 3.875 billion (3.5 % of GDP). Month-to-month worsening of GG balance is due to expected spending on government measures that were announced to compensate high energy prices.
• Energy prices compensation measures increase the deficit by the amount of EUR 418 million (0.4 % of GDP). Total costs of compensation schemes (including the 14th pension) amount to EUR 731 million (0.4 % of GDP), while SoCBR in accordance with the government’s assumptions expects income from the EU regulation regarding excessive profits in the amount of EUR 313 million.
• Estimated deviation between the SoCBR’s forecast for GGB deficit in 2022 and approved government budget remains positive and amounts to EUR 1 378 million (1.3 % of GDP), which means that the risk of public deficit rising above the government objective is low.
• Income from tax revenues and social contributions represent the most significant positive impact on the estimated level of deficit by EUR 1 630 million (1.6 % of GDP). We expect higher budgetary revenues especially from taxes, where high inflation increases the growth of macroeconomic bases compared to budget assumptions (especially labor taxes and VAT).
• According to the Draft Budgetary Plan for 2023-2025 approved by the government, the deficit in 2022 amounts to EUR 5.398 million (5.0 % of GDP), what exceeds the SoCBR’s forecast by EUR 1 563 million (1.5 % of GDP). The most significant difference is identified in state budget capital expenditures, where the government does not incorporate the slow spending observed during the year.
