The last time the general government generated this amount of deficit was in the fourth quarter of 2014, when the deficit reached EUR 867 million or 9.1% of GDP.
In the first quarter of this year expenditure growth was significantly higher compared to the same period of last year. The growth was 9.5% to EUR 5.51 billion, a record after the first quarter of 2013.
In the first quarter of 2020, growth of expenditure continued for wages (6.3%), social benefits (7.9%), intermediate consumption (12.9%) and gross fixed capital formation (2.1%).
"Additionally, the state measures for reducing the negative consequences of epidemic on the labour market and social contributions increased general government expenditure on subsidies on production by EUR 163 million," the Statistics Office wrote.
On the other hand, because of the continuing favourable trend of interest rates on financial markets, interest expenditure was reduced by 7.6% in the first quarter.
While general expenditure grew, total revenue was down 3.4% or by EUR 168 million compared to the first quarter of last year to EUR 4.77 billion.
Tax revenue had an important impact on this decrease, having fallen by 10.5% or EUR 253 million. At the same time the revenue from social contributions grew by 6.5% or EUR 121 million because of continued favourable conditions on the labour market.
Among the tax revenue, the current taxes on income and wealth decreased by 16%, and taxes on production and imports by 7%.
Consolidated general government gross debt amounted to EUR 33.41 billion or 69.6% of GDP at the end of the first quarter of 2020. Compared to the end of 2019, when it amounted to 66.1% of GDP, consolidated general government gross debt increased by 5.3% or EUR 1.67 billion.
The Statistics Office said debt increased by EUR 1.20 billion as a result of stimulus measures. "Debt in short- and long-term securities other than shares, excluding financial derivates, increased the most."
Government debt at the central level at the end of first quarter of 2020 was estimated at EUR 32.77 billion or 68.3% of GDP and at the local level at EUR 865 million or 1.8% of GDP.