The European Commission will use the report to decide about Croatia's entry into the Excessive Deficit Procedure, DZS head Marko Kristof said, adding that the report was compiled according to the European System of Accounts 95 (ESA).
Under said methodology, the consolidated general government includes the state budget and its beneficiaries, extra-budgetary beneficiaries (Croatian Waters, the Environmental Protection and Energy Efficiency Fund, Croatian Roads, the Government Asset Management Agency), public companies (Croatian Radio Television, Croatian Railways Infrastructure), local budgets and their beneficiaries, and extra-budgetary funds (Croatian Health Insurance Fund, Croatian Pension Insurance Fund, Croatian Employment Service). The State Agency for Deposit Insurance and Bank Rehabilitation was excluded.
The figures show that in the last four years, Croatia posted the biggest budget deficit in 2011 (7.8% of GDP) and the lowest in 2012 (5% of GDP).
According to the report presented today, the deficit grew markedly since 2009 and the data differs substantially from data published in annual budget execution reports according to the then methodology.
According to the latest ESA-based report, the general government deficit in 2009 was HRK 17.4 billion, or 5.3% of GDP, in 2010 it was HRK 20.6 billion (6.4% of GDP), in 2011 it was HRK 25.7 billion (7.8% of GDP), while last year it dropped to HRK 16.3 billion (5% of GDP).
According to earlier data, the deficit in 2009 was 3.5% of GDP, 4.4% in 2010, 4.3% in 2011, and 3% last year.
The DZS said this difference was due to the fact that according to the ESA, the deficit includes all state transfers, so Croatia's 2011 deficit was markedly higher because the state took on more than HRK 7 billion kuna owed by the shipyards, while the 2010 deficit included the recapitalisation of the Croatian Bank for Reconstruction and Development and the Croatian Postal Bank.
(EUR 1 = HRK 7.6)