General government deficit 2.7 per cent and debt 75.8 per cent relative to gross domestic product in 2023

Financial position of general government
weakened and debt grew

In 2023, general government deficit, or net borrowing according to national accounts, was EUR 7.4 billion. The financial position of general government weakened by EUR 6.4 billion from the previous year.

Compared to 2022, central and local government deficits weakened significantly. Central government deficit amounted to around EUR 8.6 billion, which was about EUR 4.8 billion more than in the previous year. The local government sector's deficit was EUR 3.0 billion in 2023. The deficit of local government weakened by EUR 2.6 billion from the previous year.

Of the sub-sectors of local government, local government (excl. wellbeing services county administration) showed a deficit of EUR 1.3 billion and the deficit of wellbeing services county administration was EUR 1.6 billion. Social security funds are divided into employment pension schemes and other social security funds. The surplus of employment pension schemes was around EUR 3.0 billion and that of other social security funds about EUR 1.1 billion.

General government deficit became revised from the national accounts published in March 2024. In the central government sub-sector, net lending improved by EUR 400 million in 2022 and weakened by the corresponding sum in 2023. With revised data, general government deficit was 0.4 per cent in 2022.

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Consolidated general government gross debt (EDP debt) amounted to EUR 210.5 billion at the end of 2023. The debt grew by EUR 13.7 billion in 2023. Central government debt grew by EUR 14.6 billion and local government debt grew by EUR 0.9 billion. Debt of social security funds decreased by EUR 1.2 billion.

The increase in consolidated items between general government by EUR 540 million contributed to the debt of the entire general government sector growing by said EUR 13.7 billion in 2023. The EDP debt describes general government’s debt to the other sectors of the economy and to the rest of the world, and its development is influenced by changes in both the unconsolidated gross debt and the internal general government debt.

EDP reporting tables, notification in April 2024 (PDF) 

Eurostat will publish preliminary data on Member States on 22 April 2024.

Central government's EDP debt differs as a concept from the central government debt published by the State Treasury

In general government accounts, the European Financial Stability Facility EFSF is, based on Eurostat's decision, handled so that EFSF's borrowing is recorded as part of the gross government debt of the countries that have provided guarantees. The loan received by the beneficiary country from the EFSF is recorded as if it had been received from the countries in the euro area that have provided guarantees and these countries in turn owe the corresponding amount to the EFSF. As a result, the EDP gross debt of the countries that provided guarantees grows but the net debt remains unchanged because the countries have a similar receivable from the beneficiary country. 

The gross government debt to be recorded in each country’s general government debt on the loans granted by the EFSF is calculated by dividing the loan granted to the beneficiary country by the contribution key (based on the share in the ECB's capital of each country participating in the support operations). 

At the end of 2023, Finland's general government debt includes EUR 3.3 billion of debt granted by the EFSF to beneficiary countries. Corresponding treatment does not apply to the European Stability Mechanism (ESM).

Central government's EDP debt differs as a concept from the central government debt published by the State Treasury. Central government's EDP debt includes loans granted to beneficiary counties by the European Financial Stability Facility EFSF, received cash collateral related to derivative contracts, the capital of the Nuclear Waste Management Fund, debts generated from investments in central government's PPP (public-private partnership) projects, and coins that are in circulation. ARA interest subsidy loans are also included in general government debt.

In National Accounts, central government is also a broader concept than the budget and financial economy. However, the State Pension Fund is classified as a social security fund. The valuation principle for both debt concepts is the nominal value, where the effect of interest-rate contracts and currency swaps is taken into account. When these differences are taken into consideration, we reach the central government non-consolidated gross debt in accordance with the EDP concept (Appendix table 2).

In 2023, the State Treasury's central government debt EUR 156.2 billion + conceptual differences of the debt EUR 4.9 billion + differences caused by the sector delimitation EUR 4.0 billion + differences due to the recording of ARA interest subsidy loans EUR 10.1 billion = central government gross debt EUR 175.2 billion.

The stock of ARA interest subsidy loans added to local government amounted to EUR 7.0 billion. Hence, the impact of the rearrangement of ARA interest subsidy loans on the general government consolidated EDP debt was EUR 17.1 billion.

A list of units belonging to general government and decisions on major sector classification cases (only in Finnish). 

Finland updated the EDP inventory concerning the compilation of deficit and debt data in connection with the April 2021 release (updated methodological description).