Statistics Iceland releases now a new issue of Statistical Series. This issue presents the main indicators on Government Finances in the 1st quarter of 2011. The financial balance of the general government (i.e. the central government, the social security funds and the local governments) amounted to 13.3 billion ISK in deficit or 3.5% of quarterly GDP and 8.2% of general government total revenue. This can be compared with 20.7 billion ISK in deficit in the 1st quarter of 2010 or 5.6% of GDP in that quarter. The deficit has not been less since the third quarter of 2008 (see diagram).

The general government total revenue has increased by 3.2% between the 1st quarters of 2010 and 2011, or from 157.4 billion ISK to 162.3 billion ISK. This increase can mainly be explained by increased revenue from income taxes (2bn ISK increase), social contributions (2bn ISK increase) and taxes on goods and services (1bn ISK increase). The total expenditure decreased at the same time by nearly 1,5%, or from 178 billion ISK in 2010 to 175.6 billion ISK in 2010. The main reasons are a 2.6 billion ISK decrease in interest payments and 1.5 billion ISK decrease in investment. Against this, the social benefits increased by 1,5 billion ISK between these quarters.

The central government total liabilities at the end of the 1st quarter 2011 amounted to 1,717 billion ISK or 106% of the GDP. Taking account of its financial assets, the net financial assets, i.e. the financial assets less liabilities, was negative by 646 billion ISK or 40% of the GDP, compared with a negative net financial asset of 33.6% of the GDP in the same period in 2010 and 16.3% in 2009. Consequently, the central government net financial asset position has deteriorated by 129 billion ISK between the 1st quarters 2010 and 2011.

Quarterly government accounts, 1st quarter 2011 - Statistical Series