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2008 Surplus Becomes Huge Deficit

Published onsdag 27 maj 2009 kl 15.21

The central government’s budget deficit has jumped to just over 20 billion dollars from last year’s surplus of 17.5 billion, reveals the Swedish National Financial Management Authority (ESV) in a new report.

Half of the sharp decrease in funds can be attributed to so-called “one-time effects,” namely money given to banks to shore up the financial system. But lower tax revenues, increasing unemployment and interest payments, and bail-out money given to municipalities and county councils also play a role.

The budget deficit is expected to drop to 12.8 billion next year, and 9 and 6.5 billion dollars in 2011 and 2012. But the ESV warns that the figures could be even higher, putting great pressure on the state’s finances for years to come. (ln)

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