Notification of general government deficit and debt

 


The notification of government deficit and debt is compiled for past four years as a rule and submitted by each member state of the EU twice a year, regularly at the close of February and August, including a projection for the current year. The calculation of the aggregates requested relies on the methodology of the European system of national accounts (ESA 95). Pursuant the Maastricht criteria, the deficit and the cumulated debt should not exceed 3% of GDP and 60% of GDP, respectively.

 
Unit
Year
2001
2002
2003
2004
Net borrowing (deficit) of general government (in current year)
CZK bn
-137,0   
-163,0
-319,5
-83,5
General government consolidated gross debt (at end of year)
CZK bn
608,7
719,0
941,3
1 011,5
Gross domestic product (GDP)
CZK bn
2 315,3
2 414,7
2 555,8
2 750,3
General government deficit in % of GDP
%
5,9
6,8
12,5
3,0
General government debt in % of GDP
%
26,3
29,8
36,8
36,8

The government deficit/surplus and the government debt reflect the financial performance of all institutional units classified to the general government sector – they are governmental departments, territorial self-governing units, semi-budgetary (subsidized) organizations, state-owned and other extrabudgetary funds, transformation institutions, public universities, and health insurance corporations.
 
Government deficit/surplus refers to net borrowing (-) or net lending (+) including interest on swap transactions. It shows the ability of the general government sector to finance other entities (+) or the sector’s need to be financed (-).
 
Government debt includes, by definition, obligations of the general government sector resulting from currency emissions (not applicable to the CR), received deposits, emitted securities other than equity (except for financial derivatives), and received loans.
 
The Czech Statistical Office compiles the requested indicators for past years (2001-2004 in this case). The data are gradually refined, depending on the compilation and major revisions of annual national accounts and on methodological changes made on account of adjustments to respective EU regulations. The estimated levels of government deficit and debt in the February notifications for the previous year are always based in part on preliminary information combined with the application of extrapolation methods and expert guesses.
 
The Ministry of Finance is responsible for the projection of government deficit and debt for current year (now 2005) and also for its publication.
 
Data shown in the table above were sent to the European Commission and Eurostat, within the scope of September notification, on 31 August 2005. In comparison with the March notification, the data are based on more detail information on government transactions and they respect recommendation of a mission of Eurostat experts to the CZSO in August, especially concerning the methods of recording government guarantees. A decreas of non-financial revenues and a increase of intermediate consumption and capital expenditures in some government units had an impact on the government deficit in 2003. Opinion of the EU Commission can be expected at the end of September 2005.
 
Prague, 16 September 2005