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Austrian public deficit stable at 2.5% in 2012

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(Globalpost/GlobalPost)

Austria's public deficit remained at 2.5 percent of gross domestic product (GDP) in 2012, as in 2011, preliminary data showed on Thursday, defying expectations that it would exceed the EU's 3.0-percent limit.

Both spending and income rose by 4.4 percent last year from 2011, resulting in a deficit of 7.7 billion euros ($9.8 billion), according to figures released by the national statistics office, Statistik Austria.

The government had earlier forecast a far higher deficit of 3.1 percent for the year, just above the EU threshold.

EU countries are supposed to run public deficits of no more than 3.0 percent of GDP, and are expected to work towards a balance or even a surplus in times of economic growth.

Statistik Austria said the spending increase was mostly due to costs associated with a banking aid package, as well as social security and civil service payments.

Total debt amounted to 73.4 percent of GDP, or 227.4 billion euros ($291 billion), compared with 72.5 percent a year earlier, Statistik Austria also said, a level which exceeds the EU's 60-percent limit.

For 2013, the government has forecast a deficit equivalent to 2.3 percent of GDP, while debt is expected to hit a new record of 75.4 percent of GDP.

ssw/wai

http://www.globalpost.com/dispatch/news/afp/130328/austrian-public-deficit-stable-at-25-2012