The central budget had a deficit of HUF 1,683.5bn at the end of the month and the social security funds were HUF 77.3bn in the red, but separate state funds had a HUF 38.0bn surplus.

The deficit widened from HUF 67.8bn at the end of January.

The ministry attributed the gap to one-offs, pointing to VAT rebate seasonality that resulted in net VAT revenue of just HUF 318.5bn, 4pc of the full-year target, as well as a HUF 536bn expenditure for pensioners' annual bonus, paid in February.

The ministry said that revenue from tax and contributions had climbed 13.5pc from the same period a year earlier.

Interest expenditures, first of all for interest payments on retail government securities, came to HUF 1,038.3bn, up HUF 182.9bn from the base period.

Hungarian national debt will fall this year and in the following years as well - ministry

Contrary to a report published by the European Commission's, there are no short or long-term risks regarding Hungary's state debt, the National Economy Ministry said in a statement on Wednesday.

The government is committed to fiscal discipline, including reducing public debt, the ministry said in response to the EC’s Debt Sustainability Monitor report.

The ministry said the fundamentals of the Hungarian economy are stable, the FX composition and ownership structure of the public debt are sufficiently diversified, and the financing of state operations is secure and stable. This is also reflected in the ratings of credit rating agencies, which continue to unanimously put Hungary in the investment grade level, reflecting unwavering confidence.

The ministry said that continuing its earlier practice, when planning the 2026 budget, the government is calculating with a decreasing deficit and decreasing public debt.

The ministry noted that in November 2024 the EC forecasted that state debt level in Hungary could reach 74.5pc of GDP at the end of 2024, while in fact the actual figure could have been significantly lower. Thus, the EC's forecast could have shown a significant difference even in such a short term.

In its report the EC said that as a baseline scenario Hungary’s gross debt ratio as a share of GDP could be at 74.5pc both in 2024 and 2025, decrease to 73.7pc in 2026 and climb to 74.2pc in 2027.

The National Economy Ministry said that overall its position is that the findings in report of the EC cannot be supported by factual data.

Source: 
MTI - The Hungarian News Agency, founded in 1881.

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