State went from surplus to deficit. Finance blames previous Government – State Budget

From a robust surplus to a deficit of 259 million euros. By March, the budget balance had returned to the red, which had not happened since the end of 2022.

In a short statement from the Ministry of Finance, which precedes the release of the budget execution summary, it is stated that “until March, budget execution, in public accounting, recorded a deficit of 259 million euros, the first since December 2022, the which in year-on-year terms (comparison with January-March 2023), means a reduction in the budget balance by 5.3 billion euros”.

Minister Joaquim Miranda Sarmento’s office states that the “year-on-year degradation of the budget balance, in the first quarter of 2024, represents 2.3 billion euros, if the base effect of the transfer of the CGD pension fund in 2023 is removed”, worth 3 billion euros. But the Finance Minister’s office notes that this degradation is justified by measures taken by the previous government, when Fernando Medina was Finance Minister. “It should be noted that, in January 2024, there was a surplus of 1,177 million euros, which turned into a deficit of 259 million euros, in March.

This strong degradation of the budget balance, between January and March 2024, results, to a large extent, from decisions and commitments made this year by the previous government and, in many cases, after the March 10 elections”, says the note.

According to the Government’s forecasts included in the Stability Program, the surplus should reach, in national accounts, 0.3% of GDP at the end of this year, and this forecast does not yet incorporate new measures that the Executive may implement in the coming years. months, as is the case with IRS relief.