Deficit back to overcome 3% from 2016 without further measures – iOnline

The Board of Public Finance (CFP) estimates that the budget deficit will be below 3% in 2015, but that, without further measures, from 2016 and 2019, exceed this limit set by European rules.

In the report “Public Finance: Situation and Determinants (2015 – 2019)” presented on Wednesday in Lisbon, the CFP economists write that, “the scenario presented, maintenance of policies in place, the path of budget balance points to a deficit close but above the ceiling of 3% of GDP [gross domestic product] from the year 2016 “.

According to the CFP accounts, with the well-known measures, the budget deficit will be 2.8% of GDP this year, but will rise to 3.3% in 2016, stabilizing in 3 2% between 2017 and 2019, the last year of the projections.

The CFP states that the 2015 deficit (2.8%) results from the “slowdown in the pace of consolidation than originally anticipated in the Fiscal Strategy Document” and states that “the increased deficit in 2019 against the projected value for 2015 of about 0.4 percentage points of GDP, due to a reduction in the primary surplus, which could reach 1.2 percentage points of GDP between those years. ”

In the coming years, the development of the budget balance “should benefit from the improvement in economic activity, resulting in a breakdown of the number of recipients of unemployment benefits and increased tax revenue and social contributions”.

However, “this improvement will not be enough to counter the other fiscal pressures,” since “the nominal pressures appear to be at least as strong as the dynamics of product,” reads the report .

The report’s authors argue that the deterioration of the fiscal balance projected for 2016, “essentially reflects the fact that in 2016 fail to consider the surcharge of maintenance for IRS and to consider the effect of the expenditure Total replacement of salaries to employees of public authorities “.

In the report presentation, the president of the institution, Teodora Cardoso, explained that the forecasts contained in the document represent “what would happen if we do not take any additional measures to those already quantified and legislated” ie do not consider “measures that have not yet legislated or those requiring annual law to be restored” as is the case with IRS surcharge.