Hungary posts Dec HUF 435bn budget surplus

The figure was in line with the first estimate.    

    The surplus in December indicates that Hungary s budget deficit target of 3.8 percent of gross domestic product in 2010 will be met, the ministry said.

    The second installment of the new taxes on the financial sector amounted to 89.4 billion forints while taxes on the telecommunications, retail and energy sectors accrued revenue of nearly 152 billion forints, the ministry said.

    Analysts polled by MTI on Thursday agreed that the 2010 deficit target was achievable. They predicted a budget surplus of 4-6 percent of GDP in 2011, due to the one-off effect of private pension fund savings channelled into state funds, an item which can no longer be accounted for in 2012.

    Gergely Forian Szabo, analyst at Pioneer Funds, said the 2010 deficit target of 3.8 percent set by the previous government will be met after a reconfiguration of the budget both on the revenue and spending side. However, this reflects on misplanning, lavish spending and one-off revenues more than anything else, he said.

    Gergely Suppan, analyst at Takarekbank, said the government s announced fiscal rigour was less apparent in connection with spending than with the sectoral crisis levies.

    Zsolt Kondrat of MKB Bank said public administration spending was still 166 billion forints over the 2009 figure and state-financed institutions were still overspending despite a restructuring at ministries in the second and third quarters last year.