Publication of public deficit figures
The Public Authorities consolidated deficit has shrunk to 0.37% of GDP in the first quarter, 45.6% less than in the same period of the previous year
News - 2017.6.27
The consolidated deficit of the Central Government, Autonomous Regions and Social Security for the period January-April has also been published, yielding a deficit of 0.79% of GDP.
Finally, the first budget execution figures for Local Authorities for 2017 have also been released, resulting in a surplus of 1.48 billion euros in the first quarter of the year, more than double the figure posted in the same period of the previous year.
State deficit (May)
In the period January-May, the State posted a deficit of 16.16 billion euros, equivalent to 1.39% of GDP, 0.73 points below the previous year's figure of 2.12% of GDP.
Non-financial State revenue
At month-end May, non-financial State revenue amounted to 62.79 billion euros, compared to the 59.08 billion euros recorded in the same period 2016.
Revenue from taxes and social contributions amounted to 57.93 billion euros. The higher revenue from current income and property taxes was notable, having grown by 15.8% to 17.27 billion euros due to the higher revenue from the first fractioned payment of corporate income tax on the back of Royal Decree-Law 2/2016 and Royal Decree-Law 3/2016, in force since October and December last year, respectively. The impact of these measures has been estimated by the Spanish Tax Agency (Spanish acronym: AEAT) to be 2.6 billion euros. Taxes on production and imports grew by 4.5% to 37.76 billion euros, mainly due to the performance of VAT revenue, up by 5.3% to May compared to the same period of the previous year.
With regard to non-tax revenue, interest revenue increased by 7.5% and current and capital transfers between Public Authorities received by the State rose by 1.7%. Of the headings showing a decrease, property income was the most significant, down by 17.2% due to Bank of Spain profits falling by 519 million euros.
Non-financial State expenditure
Non-financial State expenditure to May fell by 4.5% year-on-year to 78.95 billion euros.
There has been a general downward trend in nearly all expenditure items, with a 4.8% drop in current expenditure over the period January-May 2016. Current transfers between Public Authorities, which is the largest item, amounted to 43.93 billion euros, 5.6% less than in the previous year. Transfers made to the State Public Employment Service to finance unemployment benefits shrank by 1.27 billion euros, thanks to the continuing improvement of the job market. Also down, by 4.3%, were transfers to Autonomous Regions, due to the fact that prepayments made to the financing system to May totalled 284 million euros compared to the 1.27 billion euros of prepayments made in the same period of the previous year. Finally, transfers to Central Government bodies also fell, in this case by 11.2%.
The intermediate consumption expense shrank by 1.7%, while accrued interest to May fell by 5.4%. Employee remuneration expense also fell, down 5.6%, mainly due to the fact that by May 2016 practically half the extra payment not given to public sector workers in 2012 had been paid out. Excluding this effect, employee remuneration expense would contract by 0.8%. Contributions to the European Union budget also decreased compared to the previous year, by 17%, as did international cooperation contributions, by 25%.
Among the current expenditure items that have increased are social benefits other than social transfers in kind, which posted a 1.9% increase, mainly as a result of the performance of civil service pensions, up by 3.9% compared to the same period the previous year. Other current expenditures are also up, mainly due to spending to cover the electricity deficit, up from 915 million euros in May 2016 to 1.64 billion euros in May 2017.
With regard to capital expenditure, gross capital formation amounted to 1.79 billion euros, 1.3% higher than in 2016, and investment aid grew by 45.6% due to the contributions to ADIF-High Speed railways in the amount of 187 million euros, without any corresponding amount in 2016. Conversely, capital transfers to other Public Authorities decreased by 2.2%.
Combined deficit of the Central Government, Autonomous Regions and Social Security (April)
In the first four months the consolidated deficit of the Public Authorities, excluding Local Authorities, stood at 9.22 billion euros, equivalent to 0.79% of GDP. This figure excludes the net balance of aid to financial institutions, which at month-end April posted a negative figure of 264 million euros.
Central Government
The Central Government posted a deficit of 8.05 billion euros at month-end April, equivalent to 0.69% of GDP. The Central Government balance includes the State balance and the deficit of Central Government bodies; it is set out below:
- The State deficit to April stood at 7.80 billion euros (0.67% of GDP).
- At month-end April, Central Government bodies posted a deficit of 246 million euros (0.02% of GDP).
Social Security funds
Social Security funds recorded a surplus of 1.89 billion euros, 11.8% higher than the surplus posted in the same period of the previous year. In this subsector we would highlight the performance of revenues from social contributions, up by 4.7% to April. This reflects an improvement over the same period of the previous year when social contributions grew by 3.1%.
The State Public Employment Service posted a surplus of 527 million euros, equivalent to 0.05% of GDP in the first four months of 2017, compared to the 0.06% of GDP recorded in the same month of the previous year. This lower surplus is the result of lower transfers received from the State to fund unemployment benefits, which shrank by 7.7% to April 2017 due to the favourable performance of the job market. The Social Security system posted surplus of 1.38 billion euros this year, 288 million euros more than in the previous year, due to the fact that 3.0% increase in spending was lower than the increase in revenues, which stood at 3.6%. Finally, the deficit of the Wage Guarantee Fund (Spanish acronym: FOGASA) shrank from 117 million euros as at April 2016 to 15 million euros in the same period of the 2017.
Autonomous Regions
At month-end April the deficit of the Autonomous Regions increased to 0.29% of GDP to 3.32 billion euros, a 0.10% increase over April 2016.
Combined deficit of the Public Authorities (March)
On Tuesday the first budget execution figures for Local Authorities in national accounting terms were also published for the first quarter of the year. In this period, Local Authorities posted a surplus of 1.48 billion euros, equivalent to 0.13% of GDP (compared to the 0.06% recorded in the same period 2016).
With these figures from Local Authorities, the consolidated deficit of all Public Authorities, excluding financial aid, is 4.29 billion euros in the first quarter of 2017, equivalent to 0.37% of GDP.
For further information on the State budget execution please consult the document "Main economic and financial activity indicators of the State" (only in Spanish), available at:
For more detailed information on the budget execution of the Central Government, Autonomous Regions, and Social Security, please consult the "Monthly report (national accounting consolidated data)" (only in Spanish), available at:
For more detailed information on the budget execution of the Local Authorities and all Public Authorities please consult the document "Quarterly accounts of the Public Authorities" (only in Spanish), available at:
Ministerio de Hacienda y Función Pública