General Government’s budgetary position slightly improved

news release no 157

According to Statistics Estonia, the Estonian general government sector surplused in the 3rd quarter 2009 by 1.4 billion kroons. The consolidated gross debt level rose up to 13.8 billion kroons.

In the 3rd quarter, after three consecutive quarters in deficit, the total revenues of the general government sector consolidated budget exceeded the expenditures by 1.4 billion kroons once more. Through the years the biggest surplus was gained in the 3rd quarter, but since 2002 the only quarter in deficit was the last one — until 2008, when the surplus was achieved only in the 3rd quarter.

Compared to the 2nd quarter the general government’s wage costs decreased the most (1.1 billion kroons), similarly, the general government transfers to other sectors to cover operating expenses decreased almost by half. In the 3rd quarter the expenses for social welfare were 0.5 billion kroons less than in the previous quarter, but compared to the 3rd quarter of 2008 the social benefits increased by 700 million kroons due to the growth in expenses for unemployment benefits and state pensions. During the year the investment expenditures decreased the most (35%), but the usage of European funds for making the capital expenses increased considerably. The unusually grown receipts of proprietors' income have played their role in improved budgetary situation.

This surplus is still not sufficient to counterbalance the deficit of the first half-year: the nine months’ total expenditures of the general government sector consolidated budget exceeded the revenues by 7.9 billion kroons, accounting for 4.9% of the same period’s GDP. In the nine months the general government sector’s consolidated revenues made up 65 and expenditures 73 billion kroons; in 2008 69 and 71 billion kroons, respectively.

The general government gross debt level continued to grow in the 3rd quarter; the debt level according to Maastricht criteria has increased since the beginning of the year almost by a billion kroons — to 13.8 billion kroons. The central government’s debt level slightly decreased in the 3rd quarter (25 million kroons), but grew by 36% compared to the same period of 2008. The debt of the local government sector increased by 125 million kroons in the 3rd quarter, 23% within a year. While the central government has financed its activities mainly by contracting loans, the largest local authorities issued securities to find disposable funds.

General government surplus/deficit and gross debt level,
1st quarter 2001 – 3rd quarter 2009

Diagram: General government surplus/deficit and gross debt level, 1st quarter 2001 – 3rd quarter 2009

Statistics Estonia publishes the preliminary data for 2009 general government consolidated budget surplus/deficit and debt level on 26 March 2010.

For further information:

Agnes Naarits
Head of the National,  Financial and Environmental Accounts Department
Statistics Estonia
Tel +372 625 9323

More detailed data have been published in the Statistical Database.