Statistics Iceland releases now a new issue of Statistical Series. This issue presents the main indicators on Government Finances in the 2nd quarter of 2011. The financial balance (or net lending/borrowing) of the general government (i.e. the central government, the social security funds and the local governments) was 23.6 billion ISK in deficit in the 2nd quarter of 2011 or 5.9% of quarterly GDP and 14.4% of general government total revenue. The outcome improved a little compared to the 2nd quarter 2010 but is worse than in the 1st quarter 2011 when it was 17 billion ISK in deficit or 10.7% of the general government total revenue.
The general government total revenue increased by 5.0% between the 2nd quarters of 2010 and 2011, or from 156.1 billion ISK to 163.8 billion ISK. This can be explained by increased revenue from income taxes (6bn ISK), taxes on goods and services (2bn ISK) and social contributions (0.6bn ISK), and by 1.2 billion ISK decrease in other revenue.
The total expenditure increased at the same time by 2.8%, or from 182.3 billion ISK in 2010 to 187.4 billion ISK in 2011. The main reasons are increase in social benefits (4bn ISK), purchases of good and services (2bn ISK) and wages (2.2bn ISK). Against this, the investment decreased by 2 billion ISK and interest cost and other expenditure by 1.2 billion ISK.
The central government total liabilities at the end of the 2nd quarter 2011 amounted to 1,803 billion ISK or 111.3% of the GDP. Taking account of its financial assets, the net financial assets, i.e. financial assets less liabilities, was negative by 686 billion ISK or 42.4% of the GDP, compared with a negative net financial asset of 35.5% of the GDP in the same period in 2010 and 27.5% in 2009. Consequently, the central government net financial asset position has deteriorated by 140 billion ISK between the 2nd quarters 2010 and 2011.
Quarterly government accounts, 2nd quarter 2011 - Statistical Series