In a statement on the budget outturn to April, the Technical Budget Support Unit (UTAO) estimates that the deficit “was between 0.3 percent and 1.7 percent of GDP” in national accounting terms - which counts for the country’s commitments to the European Union. That means that the central estimate is for a deficit of 1 percent.
If that figure is confirmed, the first-quarter deficit is 9.6 percentage points down on the same period of last year, when the state injected €3.9 billion into state savings bank Caixa Geral de Depósitos (CGD), hugely inflating the deficit.
Excluding such extraordinary measures, the deficit was down 1.1 percentage points on a year earlier, the UTAO said.
Despite that improvement, the UTAO notes that the deficit for the quarter was smaller than the objective of the year set out in the 2018 state budget, but larger than the revised estimate for 2018 in the Stability Programme for 2018-2022 submitted to the EU this year.
The budget, which was submitted to parliament in October, pencilled in a 1 percent deficit for the whole year, which was then raised to 1.1 percent following the addition of various spending measures in response to last year’s devastating forest fires.
In the Stability Programme, the Socialist government revised the deficit projection down to 0.7 percent, prompting criticism from some members of its support base in parliament.
The National Statistics Institute (INE) is to release official national accounts for the first quarter on 22 June.