UTAO says deviation in the deficit is “risk factor” for annual target – TVI24

The budget deficit 5.8% of GDP in the first quarter presented an “unfavorable shift” against the annual target, the UTAO considers to be a “risk factor” to meet the 2015 deficit target of 2.7%.

In a quick note on national accounts for general government, to which Lusa had access on Monday, the Technical Unit of Budget Support (UTAO) states that “the overall general government deficit in the first quarter exceeded the goal for the annual deficit, “getting 3.1 percentage points above the target of 2.7% of GDP.

The independent technical supporting parliament claim that, in nominal terms and excluding the extraordinary character of measures, “the first quarter of the deficit represents approximately 49% of total planned deficit for the whole year.”

“The scale of the unfavorable deviation (…) it is still a risk factor for the fulfillment” of the budgetary objective that the government set for this year, to reduce the budget deficit to 2, 7% of gross domestic product (GDP), warn yet.

The economists UTAO consider that “there is uncertainty” when the budget performance of the rest of the year and identify factors in both directions.

The execution until April (registered public accounting) has presented “less favorable fiscal performance than anticipated in the state budget for 2015, but the results of budget execution have been improving over year, says the UTAO

In addition, the technical note that “this year there may be a higher uncertainty about the fiscal performance compared to previous years, in that there will be a change of legislative cycle.”

However, the UTAO safeguard that despite the “significant weight” of the deficit in the first three months of the year, “the unfavorable deviation from the annual target in the first quarter should not be understood as necessarily indicative of performance expected for the whole year, “as it is” still very partial information. “

Last week, the National Statistics Institute (INE) released the value of the budget general government deficit up March, which reached 2.4443 billion euros, equivalent to 5.8% of GDP in that period, which compares with a deficit of 5.9% a year earlier.