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No. 40, 25.03.2011
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General Government budget was in small surplus last year
According to preliminary data of Statistics Estonia, in 2010, the Estonian general
government sector surplus was 0.1% and gross debt level was 6.6% of Gross Domestic
Product (GDP).
According to preliminary data, at the end of 2010, the total revenues of the general government
sector surmounted the expenditures, accounted as the Maastricht deficit criteria, by 18.3 million
euros (286 million kroons). Compared to 2009, the volume of revenues and expenditures
decreased significantly. Tax revenues were 2.3% smaller. Taxes on products and production
decreased 5% mostly due to the poor income from the excises on tobacco, and the 7% decrease
in the taxes on properties was caused by a fall in the received corporate income taxes. The
revenue from social security contributions increased 3%. The state property income declined
substantially (29%) mainly due to a smaller income from dividends. The production activities of
enterprises gained more support from the state budget than earlier. The state investments in
fixed assets fell back by nearly a fourth.
The decrease in general government’s wage costs continued. In 2010, 66 million euros (1.03
billion kroons) were paid out as wages and social contributions, which is 4% less than a year
before. 3.4% less was spent on social benefits in total; costs decreased mainly on account of
health and unemployment insurance disbursements, which fell by 45%. At the same time, the
expenditures on pensions and family benefits rose by 3.2%.
The expenditures of central government exceeded the revenues for a third year in succession
and the deficit was 92.4 million euros (1.4 billion kroons). At the same time, the remaining loan of
the central government decreased by nearly 5%. The sales of Kyoto Assigned Amount Units, on
which 158 million euros (2.5 billion kroons) were earned, had a significant effect on the central
government income level. By the international methodology, the revenues from the sales of
Assigned Amount Units are accounted in Government Finance Statistics within the period when
the ownership of these units changes, and the “green investments” made out of these revenues
are accounted accordingly in the period when the expenditures occur. The linking between
revenues and expenditures is the choice of each country; therefore, in the case of sales of
Assigned Amount Units linked with the investment liabilities, the accounting rules do not provide
for the option of accounting the revenues-expenditures neutrally as it is in the exceptional
accounting of EU support.
Surplus/deficit and debt level of the general government, 1995–2010
10
% of GDP
8
Debt
6
4
2
Budget
deficit/surplus
0
-2
-4
95
96
97
98
99
00
01
02
03
04
05
06
07
08
09
10
For the first time after the restoration of independence, the year ended with surplus in the local
governments’ sector, where the revenues exceeded the expenditures made by 27.2 million
euros (426 million kroons). The debt level of local governments fell 3% during the year. Nearly
three-quarters of the local governments reduced their debt liabilities during the year, whereas
smaller governments, whose loan agreements are in general signed for a shorter period, were
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more active in paying back their loans. The debt burden of major local governments remained on
the same level or, in some cases, increased a little.
Unlike in 2009, the social security funds ended the year 2010 with a surplus, which comprised
0.6% of the GDP. The debt of social security funds is continuously very small compared to other
sectors. The general government consolidated debt (Maastricht debt) was 951 million euros
(14.9 billion kroons) at the end of 2010, having decreased 4% compared to the previous year.
Almost two times less money was spent on interest expenditures than in 2009.
In Estonia the General Government sector is divided into three sub-sectors: 1) central
government (state budget units and extra-budgetary funds, foundations, public-legal institutions);
2) local governments (city and commune administrations with their subsidiary units, foundations);
3) social security funds (Health Insurance Fund, Unemployment Insurance Fund).
Eurostat is going to publish the data on the preliminary debt and deficit levels of the Member
States on 26 April.
For further information:
Agnes Naarits
Head of the National, Financial and Environmental
Accounts Department
Statistics Estonia
Tel +372 625 9323
More detailed data have been published in the
Statistical Database (http://www.stat.ee/sdbupdate?db_update_id=8040).
Information concerning the Excessive Deficit Procedure
and the reporting can be found on the web site of Statistics
Estonia under the heading “Subject Areas / Finance / Other
information” (http://www.stat.ee/finance)