Government deficit and debt under the Maastricht Treaty
First Release: Government deficit and debt under the Maastricht Treaty
31 August 2005 Coverage United Kingdom Theme The Economy
page 1
Government deficit and debt under the Maastricht Treaty In the financial year 2004/05 general government net borrowing, as measured on the Maastricht Treaty and Stability and Growth Pact bases, is provisionally estimated as £36.7 billion. This compares with net borrowing of £34.7 billion in 2003/04. General government net borrowing is referred to as “government deficit” in the Maastricht Treaty. General government net borrowing in financial year 2004/05 was equivalent to 3.1 per cent of gross domestic product, the same as in 2003/04. The reference value for an excessive deficit is three per cent. At end 2004/05 general government gross consolidated debt at nominal value was £480.3 billion, equivalent to 40.8 per cent of gross domestic product, compared with £442.5 billion (39.5 per cent) at the end of 2003/04. Although the debt has risen, it is still substantially below the reference value of 60 per cent.
General government net borrowing as a percentage of GDP
4 3 2 1 0 -1 -2 2001/02
2002/03 2003/04 Financial years
2001/02
2002/03
2003/04
2004/05
-0.4
22.0
34.7
36.7
0.0
2.1
3.1
3.1
380.5
399.3
442.5
480.3
37.8
37.6
39.5
40.8
General government deficit net borrowing (£ bn)
Issued by National Statistics 1 Drummond Gate London SW1V 2QQ
Telephone Press Office Public Enquiries 0845 601 3034
as a percentage of GDP General government debt debt at nominal value (£ bn)
020-7533 5725
Statistician Martin Kellaway 020-7533 5987 Email: [email protected]
Internet www.statistics.gov.uk Next publication date 31 March 2006
As a percentage of GDP
2004/05
First Release: Government deficit and debt under the Maastricht Treaty
page 2
Background Article 104 of the 1992 Maastricht Treaty on European Union obliges member states to avoid excessive budgetary deficits. This article also sets out a procedure, the Excessive Deficit Procedure, to identify and counter such excessive deficits, including the possibility of financial sanctions.
General government gross debt at nominal value
as a percentage of GDP
60
40
The Protocol on the Excessive Deficit Procedure, annexed to the Maastricht Treaty, defines two criteria and reference values for compliance. These are a deficit to Gross Domestic Product (GDP) ratio of three per cent, and a debt to GDP ratio of 60 per cent. In 1997 the Stability and Growth Pact was adopted by the European Union. This clarified and strengthened the Maastricht Treaty provisions on fiscal discipline in European Economic and Monetary Union. The full provisions took effect when the euro currency was launched on 1 January 1999. EU Member Governments have to report their actual and planned government deficits, and the levels of their debt, promptly to the European Commission, to specific deadlines twice each year. The estimates in this first release have been supplied to the European Commission by ONS in accordance with the schedules in the Excessive Deficit Procedure. HM Treasury separately provide estimates for forecast years. The first deadline (1 March 2005) is designed so that the European Commission can gain an early sight of member states compliance for the previous calendar year. However, for the United Kingdom, uniquely within the European Union, the Stability and Growth Pact sets the reference period to be the financial year (1 April to 31 March), recognising the different budgetary year arrangements in the United Kingdom. The Protocol on the Excessive Deficit Procedure gives the definition of Government deficit and debt according to the 1995 European System of Accounts. This is also the manual that the ONS uses to define the United Kingdom’s National Accounts. ‘Government’ is defined as the General Government sector, which covers central, state and local government and social security funds. ‘Government deficit’ is defined as General Government Net Borrowing.
20
2001/02
2002/03
2003/04
Financial years
2004/05
First Release: Government deficit and debt under the Maastricht Treaty
page 3
Swaps Since the Protocol was established, a European Regulation has been passed that requires payments on swaps to be treated as interest payments, and hence part of General government net borrowing as reported for the Excessive Deficit Procedure. The Regulation does not amend general government net borrowing for National Accounts purposes, which is also used in the Public Sector Finances First Release. For these purposes swaps are treated as financial items. The UK Government does not use swaps to the same extent as some European Union member states. The reconciliation between these two versions of net borrowing is shown in table M7. Spectrum receipts The ONS has also presented in table M7 an alternative version of the deficit, which is consistent with a Eurostat decision on the treatment of receipts for use of the spectrum; the derivation is explained in the notes to table M7. Eurostat’s decision differs from the ONS interpretation of the 1995 European System of Accounts, which is consistent with that proposed by the Inter-Secretariat Working Group on National Accounts (ISWGNA) and agreed by the United Nations Statistical Commission (UNSC). This is used in the UK National Accounts. The alternative version for the financial year 2004/05 is £37.7 billion, equivalent to 3.2 per cent of GDP. In 2000/01, the year of the cash receipts, the surplus would be boosted from 1.6 per cent to 3.8 per cent if the alternative version was used. Deficit data in 1999/00 and earlier years are the same under both definitions. The debt data are unaffected throughout. Government Deficit Net borrowing exceeded three per cent of GDP from 1991/92 to 1996/97. Net borrowing reached a record high of £51.1 billion (7.8 per cent of GDP) in 1993/94, then fell steadily, moving into net lending (or surplus) in 1998/99. In 2001/02 it started to rise again, moving into deficit in 2002/03. It has increased in each year since, and exceeded three per cent of GDP in 2003/04 and 2004/05. Government Debt General government gross consolidated debt at nominal value, has for the last decade always been substantially below 60 per cent of GDP; the highest percentage was 51.8 per cent in 1995/96 and again in 1996/97. As a percentage of GDP, it has fallen in every year since until 2003/04. At end 2004/05 gross debt had risen to £480.3 billion, compared with £442.5 billion at end of 2003/04, the percentage rose from 39.5 per cent to 40.8 per cent. The tables present the debt position at the end of both the calendar and financial years.
First Release: Government deficit and debt under the Maastricht Treaty
page 4
The level of government debt traditionally falls during the first quarter of each calendar year. The main reason for this is the timing of tax receipts. In January there are substantial tax receipts, under self assessment and also corporation tax, which reduces the level of debt. Revisions since last data release Table M8R presents revisions to key aggregates since last published on 28 February 2005. They include all the new data used in the annual National Accounts publication, the Blue Book. The Blue Book represents ONS’s annual updating of the National Accounts. It is the time when new methodologies are implemented and the accounts are revised further back than usual. In addition to taking on the new information included in the Blue Book, this release also includes more recent information. In particular Central Government expenditure data, consistent with the Public Expenditure Outturn White Paper published on 20 July, are included. Later estimates for Local Government in 2004/05 have also been included. The data in this release are consistent with the Public Sector Finances First release published on 18 August. The Public Sector Finances First Release adopts a revisions policy whereby revisions to past periods are included in advance of National Accounts. A standard summary table of past revisions to key indicators is included in many other ONS First Releases. It is not included here because the key series have been published an insufficient number of times to support the analyses. Details of the revisions policy for this and the other public sector statistics releases is available at http://www.statistics.gov.uk/about/ Methodology_by_theme/Public_sector_accounts/default.asp
First Release: Government deficit and debt under the Maastricht Treaty
page 5
Notes to Tables Table M1 Table M1 shows, for both financial and calendar years, general government net borrowing (also referred to as “government deficit”) and the nominal value of general government gross consolidated debt, in £ million and as percentages of gross domestic product (GDP) at current market prices, which is also shown in £ million. Tables M2 and M3 These tables show, for both financial and calendar years, general government gross consolidated debt at nominal value, and the corresponding general government transactions in Maastricht debt instruments. The categories are: loans from central bank; other loans; currency and deposits; bills and short-term bonds; and medium and long-term bonds. The main component of total gross debt is medium and long-term bonds, which in 2004/05 accounted for 73.1 per cent of total gross debt. This category mainly consists of British Government Securities (gilts). Table M4 Table M4 explains how general government net borrowing reconciles with the increase in general government gross consolidated debt at nominal prices. Conceptually, the following equation holds: net borrowing (Maastricht deficit definition) + net acquisition of financial assets - swaps + consolidating transactions in government debt instruments (i.e. transactions between central and local government), - other accounts payable (which mainly consists of trade credit and accruals adjustments, which are excluded from government debt) + adjustment for holding gains/losses, + adjustment from market to nominal value + other adjustments = the increase in general government gross consolidated debt at nominal value. The other adjustments category includes Other Changes in Volume (K.10 in ESA95) for financial liabilities excluding other accounts payable, the Statistical Discrepancy Item from the Sector Account, and a further discrepancy item required to reconcile general government net borrowing with the increase in general government gross consolidated debt at nominal prices.
First Release: Government deficit and debt under the Maastricht Treaty
page 6
Tables M5 and M6 These tables reconcile general government gross consolidated debt and the corresponding transactions in government debt instruments with the Public Sector Finances version of National Accounts; the tables show how ONS calculates gross debt and the corresponding transactions. General government total liabilities from the financial balance sheet (NPVQ) and the corresponding financial transactions (NFSK) are recorded on an unconsolidated basis (i.e., including transactions between central and local government) and at market prices in accordance with ESA95. Estimates for other accounts payable (which consists of trade credit and accruals adjustments) are deducted from total financial liabilities to get unconsolidated government debt at market prices. The consolidating debt (which mainly consists of local government borrowing from central government) is then deducted to get consolidated government debt at market prices. British government securities (gilts) at market prices are then deducted and gilts at nominal prices added to get general government consolidated debt at nominal prices. Table M7 Table M7 shows the reconciliation of the three different versions of general government net borrowing. It starts with net borrowing consistent with the Public Sector Finances First Release, as published in August 2005. The net borrowing is based on the latest available data, including information that has not yet been included in National Accounts. It then shows, in the third column, net borrowing incorporating the Regulation treating swaps as interest. These are the headline figures presented in this release. Finally the table shows, in the sixth column, net borrowing formed from an alternative treatment of receipts by government for allowing the use of the spectrum by third generation mobile phone companies. Eurostat request that, for the Excessive Deficit Procedure, these are reported as being for the sale of assets and this is the third version of net borrowing shown. Cash receipts of £22.5 billion were paid to government by mobile phone companies during the second and third quarters of 2000. ONS interpretation of ESA95, is that these receipts should be treated as rents. In the National Accounts and the Public Sector Finances First Release they are treated as pre-payments of rent at the rate of £1 billion per annum over the life of the licences. For more detail please refer to the PSA page under Articles www.statistics.gov.uk/psa/
General government net borrowing (Eurostat against UK basis) as a percentage of GDP
4 Eurostat basis
3
UK basis
2 1 0 -1 -2 2001/02
2002/03
2003/04
Financial years
2004/05
First Release: Government deficit and debt under the Maastricht Treaty
page 7
To derive the numbers consistent with the Eurostat decision, net borrowing (including swaps interest payments) is adjusted by adding the rent estimates in column four and deducting the adjusted cash receipts in column five. Adopting the Eurostat treatment has the effect of more than doubling the government surplus for 2000/01, (£37.1 billion as opposed to £15.5 billion). ONS believes this disguises the true picture by scoring over 20 years of receipts in one year. Such a surplus would be consistent with the spectrum being sold, however it is just being leased to the mobile phone companies. The final three columns show each version of net borrowing as a percentage of GDP. The debt data are unaffected. Change to date of Release This release has traditionally been published on the last working day of February and August. From next year, European reporting arrangements will change, and the release will be published on the last working day of March and September.
First Release: Government deficit and debt under the Maastricht Treaty
page 8
BACKGROUND NOTES 1.
This First Release presents Government deficit and debt under the Excessive Deficit Procedure calculated according to the ONS’s interpretation of the 1995 European System of Accounts (ESA95). It also publishes the deficit consistent with a Eurostat decision on the treatment of receipts for use of the spectrum.
2.
Under the Treaty establishing the European Union, the UK government is required to endeavour to avoid an excessive government deficit (defined as general government net borrowing). All Member States are required to report their planned and actual deficit and the levels of their debt promptly to the European Commission. The data are reported to Eurostat by 1 March and 1 September each year. The March notification includes the first estimate of the calendar year outturn. The notification in September revises the data supplied in March and includes the first estimate of financial year outturn. Copies of the tables reported to Eurostat are available on the National Statistics website at www.statistics.gov.uk
3.
Apart from the swaps modification, the deficit data in this First Release are consistent with data published in the Public Sector Finances First Release 18 August 2005. It includes revisions incorporated since the Excessive Deficit Procedure data were last published in February and some further revisions which are not yet included in National Accounts. Details of the revisions policy for this and the other public sector first releases is available at http://www.statistics.gov.uk/about/Methodology_by_theme/Public_ sector_accounts/default.asp The debt data include some data revisions that have not yet been included in the National Accounts financial balance sheets.
4.
The estimate of GDP used in this release does not include the allocation to sectors of Financial Intermediaries Services Indirectly Measured (FISIM). From March 2006 it will include FISIM. The main effect will be an increase to the level of GDP.
5.
The financial year is defined as being from 1 April to the following 31 March.
6.
Further information concerning the definitions of National Accounts general government net borrowing can be found in Monthly Statistics on Public Sector Finances: a Methodological Guide, no. 12 in the Government Statistical Service methodology series at www.statistics.gov.uk/psa
7.
Details of the policy governing the release of new data are available from the Press Office, including a description of the release categories featured on the front page of the releases.
First Release: Government deficit and debt under the Maastricht Treaty
8.
page 9
National Statistics are produced to high professional standards set out in the National Statistics Code of Practice. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference. © Crown copyright 2005
M1
Government Deficit and Debt Under the Maastricht Treaty Summary Table Not seasonally adjusted
£ million
General government net borrowing
General government gross consolidated debt at nominal value
Gross domestic product (GDP) at current market prices
Net borrowing as a percentage of GDP
Gross consolidated debt as a percentage of GDP
1993/94 1994/95 1995/96 1996/97 1997/98
-MDUK 51 062 45 375 36 855 29 576 7 912
YEQG 299 845 341 031 378 312 400 657 402 555
BKTL 652 820 689 767 729 808 773 146 824 044
7.8 6.6 5.0 3.8 1.0
YEQJ 45.9 49.4 51.8 51.8 48.9
1998/99 1999/00 2000/01 2001/02 2002/03
–3 314 –14 325 –15 455 –418 21 964
401 099 395 868 383 976 380 510 399 343
870 464 921 762 965 041 1 006 523 1 062 954
–0.4 –1.6 –1.6 – 2.1
46.1 42.9 39.8 37.8 37.6
2003/04 2004/05 Calendar years
34 728 36 701
442 492 480 290
1 121 488 1 175 820
3.1 3.1
39.5 40.8
1990 1991 1992 1993 1994
8 849 18 222 39 421 50 932 46 149
189 672 201 439 239 605 291 377 330 595
557 300 586 000 610 562 641 691 680 441
1.6 3.1 6.5 7.9 6.8
34.0 34.4 39.2 45.4 48.6
1995 1996 1997 1998 1999
42 001 32 054 17 799 –105 –10 364
372 168 398 480 409 739 407 846 406 201
718 383 763 561 810 601 860 520 905 438
5.8 4.2 2.2 – –1.1
51.8 52.2 50.5 47.4 44.9
2000 2001 2002 2003 2004
–14 051 –8 278 15 614 35 595 35 095
399 413 385 324 400 303 438 648 482 697
953 576 996 758 1 048 456 1 105 919 1 164 439
–1.5 –0.8 1.5 3.2 3.0
41.9 38.7 38.2 39.7 41.5
Financial years
M2
General Government Gross Debt at Nominal Value Consolidated Not seasonally adjusted
£ million
Loans from central bank
Other loans
Currency and deposits
Bills and short-term bonds
Medium and long-term bonds
General govt. gross consolidated debt at nominal value
1993/94 1994/95 1995/96 1996/97 1997/98
YEQC 6 761 15 904 15 655 14 323 12 807
YEQD 13 070 12 548 12 415 11 430 9 808
LSJH 58 535 63 051 69 185 74 507 76 189
YEQE 5 839 10 421 13 105 7 055 4 010
YEQF 215 640 239 107 267 952 293 342 299 741
YEQG 299 845 341 031 378 312 400 657 402 555
1998/99 1999/00 2000/01 2001/02 2002/03
15 367 13 370 13 370 13 370 13 370
9 561 12 709 10 046 11 336 14 290
75 021 72 857 74 750 73 299 75 527
6 556 3 823 3 024 8 946 14 736
294 594 293 109 282 786 273 559 281 420
401 099 395 868 383 976 380 510 399 343
2003/04 2004/05 Calendar years
13 370 13 370
18 494 16 918
77 544 78 805
19 187 20 196
313 897 351 001
442 492 480 290
1990 1991 1992 1993 1994
8 323 7 533 1 821 11 10 410
11 013 9 805 17 608 15 376 12 879
44 108 46 043 51 060 57 568 63 681
13 564 11 847 7 850 7 092 8 222
112 664 126 211 161 266 211 330 235 403
189 672 201 439 239 605 291 377 330 595
1995 1996 1997 1998 1999
12 478 14 286 12 375 13 390 19 451
13 139 12 192 10 778 9 902 9 121
67 831 74 904 76 299 75 355 74 109
19 610 5 913 4 176 4 369 3 568
259 110 291 185 306 111 304 830 299 952
372 168 398 480 409 739 407 846 406 201
2000 2001 2002 2003 2004
13 370 13 370 13 370 13 370 13 370
18 763 12 973 15 496 17 965 25 823
76 829 74 305 76 501 78 498 81 288
2 040 10 678 20 957 23 836 24 895
288 411 273 998 273 979 304 979 337 321
399 413 385 324 400 303 438 648 482 697
Financial years
M3
General Government Transactions in Maastricht Debt Instruments Consolidated Not seasonally adjusted (+ = increase in liabilities, - = decrease in liabilities)
£ million
Loans from central bank
Other loans
Currency and deposits
Bills and short-term bonds
Medium and long-term bonds
General govt. transactions in Maastricht debt instruments
1993/94 1994/95 1995/96 1996/97 1997/98
YEQK 3 688 9 143 –249 –1 332 –1 516
YEQL –2 915 –554 –625 –1 180 –520
NFSO 5 291 4 552 6 154 5 576 1 708
YEQN –1 850 4 583 2 736 –5 789 –2 920
YEQO 48 963 22 662 28 219 26 795 6 786
YEQR 53 177 40 386 36 235 24 070 3 538
1998/99 1999/00 2000/01 2001/02 2002/03
2 561 –1 997 – – –
–814 –861 –2 815 –1 680 3 172
–1 206 –1 810 2 505 –1 379 2 990
2 451 –2 626 –678 5 742 5 720
–6 521 217 –13 282 –9 156 7 558
–3 529 –7 077 –14 270 –6 473 19 440
– –
3 353 –551
2 610 1 223
4 445 1 009
31 603 37 794
42 011 39 475
1990 1991 1992 1993 1994
1 276 –790 –5 712 –1 811 10 400
29 –643 5 941 –2 288 –2 854
2 013 1 962 4 750 5 053 6 055
2 765 –2 000 –4 873 –447 1 069
–6 793 11 517 30 486 53 095 24 291
–710 10 046 30 592 53 602 38 961
1995 1996 1997 1998 1999
2 068 1 808 –1 911 1 015 6 062
–138 –1 225 –1 455 –318 –684
4 169 7 114 1 903 –1 002 –386
11 541 –13 504 –1 595 –26 –608
22 605 31 503 16 608 –3 290 –4 545
40 245 25 696 13 550 –3 621 –161
2000 2001 2002 2003 2004
–6 081 – – – –
5 496 –6 787 1 678 1 320 7 791
3 096 –2 809 2 126 3 482 2 589
–1 434 8 504 10 471 2 630 1 058
–12 517 –17 410 1 866 30 338 34 184
–11 440 –18 502 16 141 37 770 45 622
Financial years
2003/04 2004/05 Calendar years
M4
Reconciliation of General Government Net Borrowing with General Government Gross Consolidated Debt at Nominal Value Not seasonally adjusted
£ million
Consolidating General Net acquisition transactions in LESS Other Adjustment for Adjustment from Government Net of financial Maastricht debt accounts holding market to Other borrowing assets LESS Swaps instruments payable (F.7) gains/losses 1 nominal value 2 adjustments
Increase in general govt. gross consolidated debt at nominal value
Financial years 1993/94 1994/95 1995/96 1996/97 1997/98
-MDUK 51 062 45 375 36 855 29 576 7 912
NFPG 1 480 –5 831 27 –1 526 –2 033
-CFZG – – – – –
YEQP –612 –367 477 1 525 1 061
-NFVL –31 –108 –532 –1 954 –1 360
EYVC .. 716 320 –2 112 –981
YEQT .. .. –1 431 –855 –192
MDQA .. .. 2 519 741 –387
50 219 41 186 37 281 22 345 1 898
1998/99 1999/00 2000/01 2001/02 2002/03
–3 314 –14 325 –15 455 –418 21 964
2 600 8 893 27 180 –6 294 –3 836
– 55 265 –85 –390
2 103 1 424 621 807 –3 130
–145 –836 –24 689 1 210 –2 749
497 –547 801 –48 –197
1 289 1 830 1 644 1 949 1 380
–280 1 123 –1 017 1 027 –469
–1 456 –5 231 –11 892 –3 466 18 833
34 728 36 701
2 963 3 206
31 –139
–3 667 837
930 –4 100
–201 –20
–425 440
1 456 2 547
43 149 37 798
1996 1997 1998 1999 2000
32 054 17 799 –105 –10 364 –14 051
–6 427 578 –756 9 490 30 012
– – – – 185
678 1 836 1 098 2 228 987
391 –2 745 –418 981 –24 626
–2 036 –663 352 –662 429
–362 –128 1 370 2 574 2 000
3 370 –1 746 –1 238 –1 436 250
26 312 11 259 –1 893 –1 645 –6 788
2001 2002 2003 2004
–8 278 15 614 35 595 35 095
–10 912 –4 375 –192 7 448
102 –238 –136 –173
245 –2 090 –4 082 604
324 2 143 –1 242 1 252
141 –145 –120 –54
1 519 1 067 –1 125 118
3 260 –1 177 1 483 967
–14 089 14 979 38 345 44 049
2003/04 2004/05 Calendar years
1 (+) = holding gain, (-) = holding loss. 2 Market value minus nominal value.
M5
Reconciliation of General Government Gross Consolidated Debt at Nominal Value with National Accounts1 £ million 2001 /02
2002 /03
2003 /04
2004 /05
2000
2001
2002
2003
2004
GENERAL GOVERNMENT TOTAL FINANCIAL LIABILITIES NPVQ
496 088 528 641 561 636 607 775 526 540 500 386 519 691 548 113 601 395
LESS Other Accounts payable (F.7)
-NNMI
–46 942 –49 403 –50 358 –58 684 –41 416 –41 817 –39 673 –41 909 –44 182
General govt. gross unconsolidated debt at market prices
YEQQ
449 146 479 238 511 278 549 091 485 124 458 569 480 018 506 204 557 213
Consolidation Local govt. borrowing from central government Local govt. holdings of Treasury Bills Central govt. holdings of local govt. short-term debt Local govt. holdings of British central govt. securities
APDP NJEX NIFU NJFK
47 269 545 209 844
44 832 264 – 431
41 540 113 – 204
42 339 154 – 215
47 879 235 315 467
47 793 382 140 660
46 131 201 242 375
42 187 164 – 272
42 961 105 – 175
Total consolidation
MDQD
48 867
45 527
41 857
42 708
48 896
48 975
46 949
42 623
43 241
General govt. gross consolidated debt at market prices
MDQE
LESS British central government securities at market prices PLUS British central government securities at nominal prices General govt. gross consolidated debt at nominal prices2
400 279 433 711 469 421 506 383 436 228 409 594 433 069 463 581 513 972
-NIJI –291 019 –316 453 –338 788 –374 215 –315 462 –292 855 –306 140 –327 095 –366 419 BKPM 271 250 282 085 311 859 348 122 278 647 268 585 273 374 302 162 335 144 YEQG
380 510 399 343 442 492 480 290 399 413 385 324 400 303 438 648 482 697
1 Public Sector Finances consistent version of data. 2 General govt. gross consolidated debt as defined in the Maastricht Treaty.
M6
Reconciliation of Transactions in Maastricht Debt Instruments with National Accounts1 £ million 2001 /02
GENERAL GOVERNMENT TRANSACTIONS IN FINANCIAL LIABILITIES LESS Other Accounts payable (F.7)
NFSK -NFVL
2002 /03
2003 /04
2004 /05
–6 876 19 059 37 414 44 412 1 210 –2 749
2000
2001
2002
2003
2004
14 173 –18 581 11 908 34 930 44 974
930 –4 100 –24 626
324
2 143 –1 242
1 252
–5 666 16 310 38 344 40 312 –10 453 –18 257 14 051 33 688 46 226
General govt. unconsolidated transactions in Maastricht debt instruments
MDQF
Consolidation Local govt. borrowing from central govt. Local govt. transactions in Treasury Bills Central govt. transactions in local govt. short-term debt Local govt. transactions in British central govt. securities
ABEC NBZA NASF NBZN
–106 –2 437 –3 290 439 –281 –152 – – – 474 –412 –225
784 41 – 12
1 400 –218 – –195
–65 –1 685 –3 943 119 –141 –38 – – – 191 –264 –101
760 –59 – –97
Total consolidating transactions
YEQP
807 –3 130 –3 667
837
987
245 –2 090 –4 082
604
General govt. consolidated transactions in Maastricht debt instruments
YEQR
1 Public Sector Finances consistent version of data.
–6 473 19 440 42 011 39 475 –11 440 –18 502 16 141 37 770 45 622
M7
Government Deficit under the Maastricht Treaty Reconciliation of versions of net borrowing Not seasonally adjusted
£ million
Spectrum Use Adjustments Net borrowing General General Gross as a Net borrowing Net borrowing government General government domestic percentage of as a as a net borrowing government net borrowing product (GDP) GDP (UK percentage of percentage of (UK National Swaps net borrowing adjusted cash (Eurostat at current National GDP (EDP GDP (Eurostat Accounts)2 adjustment (EDP version) accrued rent receipts version)3 market prices Accounts) 1 2 version)1 version) 1 3 4 Financial years 1993/94 1994/95 1995/96 1996/97 1997/98
-NNBK 51 062 45 375 36 855 29 576 7 912
-CFZG – – – – –
-MDUK 51 062 45 375 36 855 29 576 7 912
BKTK – – – – –
-LSNY – – – – –
LSNP 51 062 45 375 36 855 29 576 7 912
BKTL 652 820 689 767 729 808 773 146 824 044
7.8 6.6 5.0 3.8 1.0
7.8 6.6 5.0 3.8 1.0
7.8 6.6 5.0 3.8 1.0
1998/99 1999/00 2000/01 2001/02 2002/03
–3 314 –14 380 –15 720 –333 22 354
– 55 265 –85 –390
–3 314 –14 325 –15 455 –418 21 964
– – 806 1 044 1 044
– – –22 477 – –
–3 314 –14 325 –37 126 626 23 008
870 464 921 762 965 041 1 006 523 1 062 954
–0.4 –1.6 –1.6 – 2.1
–0.4 –1.6 –1.6 – 2.1
–0.4 –1.6 –3.8 0.1 2.2
2003/04 34 697 2004/05 36 840 Calendar years
31 –139
34 728 36 701
1 045 1 044
– –
35 773 37 745
1 121 488 1 175 820
3.1 3.1
3.1 3.1
3.2 3.2
1990 1991 1992 1993 1994
8 849 18 222 39 421 50 932 46 149
– – – – –
8 849 18 222 39 421 50 932 46 149
– – – – –
– – – – –
8 849 18 222 39 421 50 932 46 149
557 300 586 000 610 562 641 691 680 441
1.6 3.1 6.5 7.9 6.8
1.6 3.1 6.5 7.9 6.8
1.6 3.1 6.5 7.9 6.8
1995 1996 1997 1998 1999
42 001 32 054 17 799 –105 –10 364
– – – – –
42 001 32 054 17 799 –105 –10 364
– – – – –
– – – – –
42 001 32 054 17 799 –105 –10 364
718 383 763 561 810 601 860 520 905 438
5.8 4.2 2.2 – –1.1
5.8 4.2 2.2 – –1.1
5.8 4.2 2.2 – –1.1
2000 2001 2002 2003 2004
–14 236 –8 380 15 852 35 731 35 268
185 102 –238 –136 –173
–14 051 –8 278 15 614 35 595 35 095
545 1 044 1 044 1 045 1 044
–22 477 – – – –
–35 983 –7 234 16 658 36 640 36 139
953 576 996 758 1 048 456 1 105 919 1 164 439
–1.5 –0.8 1.5 3.2 3.0
–1.5 –0.8 1.5 3.2 3.0
–3.8 –0.7 1.6 3.3 3.1
1 Net borrowing as a percentage of GDP is calculated by dividing net borrowing by non seasonally adjusted GDP. 2 Version used in UK Public Sector Finances, using equivalent formulae to UK National Accounts, classification of spectrum use as rent. Net borrowing is equivalent to negative net lending 3 Version used by Eurostat, classification as sale of asset. -LSNP= MDUKBKTK+LSNY 4 The Eurostat decision has wider implications for the National Accounts System. These will affect the level of net borrowing and GDP. These wider implications have been ignored in the construction of this measure.
M8R
Government Deficit and Debt Under the Maastricht Treaty General government net borrowing
General government Gross domestic gross consolidated product (GDP) at Net borrowing as a debt at nominal value current market prices percentage of GDP
-MDUK
YEQG
Gross consolidated debt as a percentage of GDP
BKTL
YEQJ
1992/93 1993/94 1994/95 1995/96 1996/97 1997/98
0 0 0 0 -19 -32
0 0 0 -11 0 0
-16 -67 65 1150 -261 1226
0 0 0 -0.1 0 0
0 0 0 -0.1 0 0
1998/99 1999/00 2000/01 2001/02 2002/03 2003/04
-76 115 -107 -423 -1236 -679
0 0 0 0 0 1250
2021 2685 3177 2441 4994 3884
0 0 0 0 -0.1 -0.1
-0.1 -0.2 -0.1 -0.1 -0.1 0
1990 1991 1992 1993
0 0 0 0
0 0 0 0
0 0 0 0
0 0 0 0
0 0 0 0
1994 1995 1996 1997
0 0 -17 -35
0 0 1 0
0 0 951 463
0 0 0 0
0 0 -0.1 -0.1
1998 1999 2000 2001
418 -980 368 -518
0 0 0 0
1904 2271 3015 2449
0.1 -0.1 0 0
-0.1 -0.1 -0.1 -0.1
2002 2003 2004
-1416 -337 -754
0 1252 1257
4311 4678 6413
-0.1 -0.1 -0.1
-0.1 0 -0.1
31 August 2005 Coverage United Kingdom Theme The Economy
page 1
Government deficit and debt under the Maastricht Treaty In the financial year 2004/05 general government net borrowing, as measured on the Maastricht Treaty and Stability and Growth Pact bases, is provisionally estimated as £36.7 billion. This compares with net borrowing of £34.7 billion in 2003/04. General government net borrowing is referred to as “government deficit” in the Maastricht Treaty. General government net borrowing in financial year 2004/05 was equivalent to 3.1 per cent of gross domestic product, the same as in 2003/04. The reference value for an excessive deficit is three per cent. At end 2004/05 general government gross consolidated debt at nominal value was £480.3 billion, equivalent to 40.8 per cent of gross domestic product, compared with £442.5 billion (39.5 per cent) at the end of 2003/04. Although the debt has risen, it is still substantially below the reference value of 60 per cent.
General government net borrowing as a percentage of GDP
4 3 2 1 0 -1 -2 2001/02
2002/03 2003/04 Financial years
2001/02
2002/03
2003/04
2004/05
-0.4
22.0
34.7
36.7
0.0
2.1
3.1
3.1
380.5
399.3
442.5
480.3
37.8
37.6
39.5
40.8
General government deficit net borrowing (£ bn)
Issued by National Statistics 1 Drummond Gate London SW1V 2QQ
Telephone Press Office Public Enquiries 0845 601 3034
as a percentage of GDP General government debt debt at nominal value (£ bn)
020-7533 5725
Statistician Martin Kellaway 020-7533 5987 Email: [email protected]
Internet www.statistics.gov.uk Next publication date 31 March 2006
As a percentage of GDP
2004/05
First Release: Government deficit and debt under the Maastricht Treaty
page 2
Background Article 104 of the 1992 Maastricht Treaty on European Union obliges member states to avoid excessive budgetary deficits. This article also sets out a procedure, the Excessive Deficit Procedure, to identify and counter such excessive deficits, including the possibility of financial sanctions.
General government gross debt at nominal value
as a percentage of GDP
60
40
The Protocol on the Excessive Deficit Procedure, annexed to the Maastricht Treaty, defines two criteria and reference values for compliance. These are a deficit to Gross Domestic Product (GDP) ratio of three per cent, and a debt to GDP ratio of 60 per cent. In 1997 the Stability and Growth Pact was adopted by the European Union. This clarified and strengthened the Maastricht Treaty provisions on fiscal discipline in European Economic and Monetary Union. The full provisions took effect when the euro currency was launched on 1 January 1999. EU Member Governments have to report their actual and planned government deficits, and the levels of their debt, promptly to the European Commission, to specific deadlines twice each year. The estimates in this first release have been supplied to the European Commission by ONS in accordance with the schedules in the Excessive Deficit Procedure. HM Treasury separately provide estimates for forecast years. The first deadline (1 March 2005) is designed so that the European Commission can gain an early sight of member states compliance for the previous calendar year. However, for the United Kingdom, uniquely within the European Union, the Stability and Growth Pact sets the reference period to be the financial year (1 April to 31 March), recognising the different budgetary year arrangements in the United Kingdom. The Protocol on the Excessive Deficit Procedure gives the definition of Government deficit and debt according to the 1995 European System of Accounts. This is also the manual that the ONS uses to define the United Kingdom’s National Accounts. ‘Government’ is defined as the General Government sector, which covers central, state and local government and social security funds. ‘Government deficit’ is defined as General Government Net Borrowing.
20
2001/02
2002/03
2003/04
Financial years
2004/05
First Release: Government deficit and debt under the Maastricht Treaty
page 3
Swaps Since the Protocol was established, a European Regulation has been passed that requires payments on swaps to be treated as interest payments, and hence part of General government net borrowing as reported for the Excessive Deficit Procedure. The Regulation does not amend general government net borrowing for National Accounts purposes, which is also used in the Public Sector Finances First Release. For these purposes swaps are treated as financial items. The UK Government does not use swaps to the same extent as some European Union member states. The reconciliation between these two versions of net borrowing is shown in table M7. Spectrum receipts The ONS has also presented in table M7 an alternative version of the deficit, which is consistent with a Eurostat decision on the treatment of receipts for use of the spectrum; the derivation is explained in the notes to table M7. Eurostat’s decision differs from the ONS interpretation of the 1995 European System of Accounts, which is consistent with that proposed by the Inter-Secretariat Working Group on National Accounts (ISWGNA) and agreed by the United Nations Statistical Commission (UNSC). This is used in the UK National Accounts. The alternative version for the financial year 2004/05 is £37.7 billion, equivalent to 3.2 per cent of GDP. In 2000/01, the year of the cash receipts, the surplus would be boosted from 1.6 per cent to 3.8 per cent if the alternative version was used. Deficit data in 1999/00 and earlier years are the same under both definitions. The debt data are unaffected throughout. Government Deficit Net borrowing exceeded three per cent of GDP from 1991/92 to 1996/97. Net borrowing reached a record high of £51.1 billion (7.8 per cent of GDP) in 1993/94, then fell steadily, moving into net lending (or surplus) in 1998/99. In 2001/02 it started to rise again, moving into deficit in 2002/03. It has increased in each year since, and exceeded three per cent of GDP in 2003/04 and 2004/05. Government Debt General government gross consolidated debt at nominal value, has for the last decade always been substantially below 60 per cent of GDP; the highest percentage was 51.8 per cent in 1995/96 and again in 1996/97. As a percentage of GDP, it has fallen in every year since until 2003/04. At end 2004/05 gross debt had risen to £480.3 billion, compared with £442.5 billion at end of 2003/04, the percentage rose from 39.5 per cent to 40.8 per cent. The tables present the debt position at the end of both the calendar and financial years.
First Release: Government deficit and debt under the Maastricht Treaty
page 4
The level of government debt traditionally falls during the first quarter of each calendar year. The main reason for this is the timing of tax receipts. In January there are substantial tax receipts, under self assessment and also corporation tax, which reduces the level of debt. Revisions since last data release Table M8R presents revisions to key aggregates since last published on 28 February 2005. They include all the new data used in the annual National Accounts publication, the Blue Book. The Blue Book represents ONS’s annual updating of the National Accounts. It is the time when new methodologies are implemented and the accounts are revised further back than usual. In addition to taking on the new information included in the Blue Book, this release also includes more recent information. In particular Central Government expenditure data, consistent with the Public Expenditure Outturn White Paper published on 20 July, are included. Later estimates for Local Government in 2004/05 have also been included. The data in this release are consistent with the Public Sector Finances First release published on 18 August. The Public Sector Finances First Release adopts a revisions policy whereby revisions to past periods are included in advance of National Accounts. A standard summary table of past revisions to key indicators is included in many other ONS First Releases. It is not included here because the key series have been published an insufficient number of times to support the analyses. Details of the revisions policy for this and the other public sector statistics releases is available at http://www.statistics.gov.uk/about/ Methodology_by_theme/Public_sector_accounts/default.asp
First Release: Government deficit and debt under the Maastricht Treaty
page 5
Notes to Tables Table M1 Table M1 shows, for both financial and calendar years, general government net borrowing (also referred to as “government deficit”) and the nominal value of general government gross consolidated debt, in £ million and as percentages of gross domestic product (GDP) at current market prices, which is also shown in £ million. Tables M2 and M3 These tables show, for both financial and calendar years, general government gross consolidated debt at nominal value, and the corresponding general government transactions in Maastricht debt instruments. The categories are: loans from central bank; other loans; currency and deposits; bills and short-term bonds; and medium and long-term bonds. The main component of total gross debt is medium and long-term bonds, which in 2004/05 accounted for 73.1 per cent of total gross debt. This category mainly consists of British Government Securities (gilts). Table M4 Table M4 explains how general government net borrowing reconciles with the increase in general government gross consolidated debt at nominal prices. Conceptually, the following equation holds: net borrowing (Maastricht deficit definition) + net acquisition of financial assets - swaps + consolidating transactions in government debt instruments (i.e. transactions between central and local government), - other accounts payable (which mainly consists of trade credit and accruals adjustments, which are excluded from government debt) + adjustment for holding gains/losses, + adjustment from market to nominal value + other adjustments = the increase in general government gross consolidated debt at nominal value. The other adjustments category includes Other Changes in Volume (K.10 in ESA95) for financial liabilities excluding other accounts payable, the Statistical Discrepancy Item from the Sector Account, and a further discrepancy item required to reconcile general government net borrowing with the increase in general government gross consolidated debt at nominal prices.
First Release: Government deficit and debt under the Maastricht Treaty
page 6
Tables M5 and M6 These tables reconcile general government gross consolidated debt and the corresponding transactions in government debt instruments with the Public Sector Finances version of National Accounts; the tables show how ONS calculates gross debt and the corresponding transactions. General government total liabilities from the financial balance sheet (NPVQ) and the corresponding financial transactions (NFSK) are recorded on an unconsolidated basis (i.e., including transactions between central and local government) and at market prices in accordance with ESA95. Estimates for other accounts payable (which consists of trade credit and accruals adjustments) are deducted from total financial liabilities to get unconsolidated government debt at market prices. The consolidating debt (which mainly consists of local government borrowing from central government) is then deducted to get consolidated government debt at market prices. British government securities (gilts) at market prices are then deducted and gilts at nominal prices added to get general government consolidated debt at nominal prices. Table M7 Table M7 shows the reconciliation of the three different versions of general government net borrowing. It starts with net borrowing consistent with the Public Sector Finances First Release, as published in August 2005. The net borrowing is based on the latest available data, including information that has not yet been included in National Accounts. It then shows, in the third column, net borrowing incorporating the Regulation treating swaps as interest. These are the headline figures presented in this release. Finally the table shows, in the sixth column, net borrowing formed from an alternative treatment of receipts by government for allowing the use of the spectrum by third generation mobile phone companies. Eurostat request that, for the Excessive Deficit Procedure, these are reported as being for the sale of assets and this is the third version of net borrowing shown. Cash receipts of £22.5 billion were paid to government by mobile phone companies during the second and third quarters of 2000. ONS interpretation of ESA95, is that these receipts should be treated as rents. In the National Accounts and the Public Sector Finances First Release they are treated as pre-payments of rent at the rate of £1 billion per annum over the life of the licences. For more detail please refer to the PSA page under Articles www.statistics.gov.uk/psa/
General government net borrowing (Eurostat against UK basis) as a percentage of GDP
4 Eurostat basis
3
UK basis
2 1 0 -1 -2 2001/02
2002/03
2003/04
Financial years
2004/05
First Release: Government deficit and debt under the Maastricht Treaty
page 7
To derive the numbers consistent with the Eurostat decision, net borrowing (including swaps interest payments) is adjusted by adding the rent estimates in column four and deducting the adjusted cash receipts in column five. Adopting the Eurostat treatment has the effect of more than doubling the government surplus for 2000/01, (£37.1 billion as opposed to £15.5 billion). ONS believes this disguises the true picture by scoring over 20 years of receipts in one year. Such a surplus would be consistent with the spectrum being sold, however it is just being leased to the mobile phone companies. The final three columns show each version of net borrowing as a percentage of GDP. The debt data are unaffected. Change to date of Release This release has traditionally been published on the last working day of February and August. From next year, European reporting arrangements will change, and the release will be published on the last working day of March and September.
First Release: Government deficit and debt under the Maastricht Treaty
page 8
BACKGROUND NOTES 1.
This First Release presents Government deficit and debt under the Excessive Deficit Procedure calculated according to the ONS’s interpretation of the 1995 European System of Accounts (ESA95). It also publishes the deficit consistent with a Eurostat decision on the treatment of receipts for use of the spectrum.
2.
Under the Treaty establishing the European Union, the UK government is required to endeavour to avoid an excessive government deficit (defined as general government net borrowing). All Member States are required to report their planned and actual deficit and the levels of their debt promptly to the European Commission. The data are reported to Eurostat by 1 March and 1 September each year. The March notification includes the first estimate of the calendar year outturn. The notification in September revises the data supplied in March and includes the first estimate of financial year outturn. Copies of the tables reported to Eurostat are available on the National Statistics website at www.statistics.gov.uk
3.
Apart from the swaps modification, the deficit data in this First Release are consistent with data published in the Public Sector Finances First Release 18 August 2005. It includes revisions incorporated since the Excessive Deficit Procedure data were last published in February and some further revisions which are not yet included in National Accounts. Details of the revisions policy for this and the other public sector first releases is available at http://www.statistics.gov.uk/about/Methodology_by_theme/Public_ sector_accounts/default.asp The debt data include some data revisions that have not yet been included in the National Accounts financial balance sheets.
4.
The estimate of GDP used in this release does not include the allocation to sectors of Financial Intermediaries Services Indirectly Measured (FISIM). From March 2006 it will include FISIM. The main effect will be an increase to the level of GDP.
5.
The financial year is defined as being from 1 April to the following 31 March.
6.
Further information concerning the definitions of National Accounts general government net borrowing can be found in Monthly Statistics on Public Sector Finances: a Methodological Guide, no. 12 in the Government Statistical Service methodology series at www.statistics.gov.uk/psa
7.
Details of the policy governing the release of new data are available from the Press Office, including a description of the release categories featured on the front page of the releases.
First Release: Government deficit and debt under the Maastricht Treaty
8.
page 9
National Statistics are produced to high professional standards set out in the National Statistics Code of Practice. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference. © Crown copyright 2005
M1
Government Deficit and Debt Under the Maastricht Treaty Summary Table Not seasonally adjusted
£ million
General government net borrowing
General government gross consolidated debt at nominal value
Gross domestic product (GDP) at current market prices
Net borrowing as a percentage of GDP
Gross consolidated debt as a percentage of GDP
1993/94 1994/95 1995/96 1996/97 1997/98
-MDUK 51 062 45 375 36 855 29 576 7 912
YEQG 299 845 341 031 378 312 400 657 402 555
BKTL 652 820 689 767 729 808 773 146 824 044
7.8 6.6 5.0 3.8 1.0
YEQJ 45.9 49.4 51.8 51.8 48.9
1998/99 1999/00 2000/01 2001/02 2002/03
–3 314 –14 325 –15 455 –418 21 964
401 099 395 868 383 976 380 510 399 343
870 464 921 762 965 041 1 006 523 1 062 954
–0.4 –1.6 –1.6 – 2.1
46.1 42.9 39.8 37.8 37.6
2003/04 2004/05 Calendar years
34 728 36 701
442 492 480 290
1 121 488 1 175 820
3.1 3.1
39.5 40.8
1990 1991 1992 1993 1994
8 849 18 222 39 421 50 932 46 149
189 672 201 439 239 605 291 377 330 595
557 300 586 000 610 562 641 691 680 441
1.6 3.1 6.5 7.9 6.8
34.0 34.4 39.2 45.4 48.6
1995 1996 1997 1998 1999
42 001 32 054 17 799 –105 –10 364
372 168 398 480 409 739 407 846 406 201
718 383 763 561 810 601 860 520 905 438
5.8 4.2 2.2 – –1.1
51.8 52.2 50.5 47.4 44.9
2000 2001 2002 2003 2004
–14 051 –8 278 15 614 35 595 35 095
399 413 385 324 400 303 438 648 482 697
953 576 996 758 1 048 456 1 105 919 1 164 439
–1.5 –0.8 1.5 3.2 3.0
41.9 38.7 38.2 39.7 41.5
Financial years
M2
General Government Gross Debt at Nominal Value Consolidated Not seasonally adjusted
£ million
Loans from central bank
Other loans
Currency and deposits
Bills and short-term bonds
Medium and long-term bonds
General govt. gross consolidated debt at nominal value
1993/94 1994/95 1995/96 1996/97 1997/98
YEQC 6 761 15 904 15 655 14 323 12 807
YEQD 13 070 12 548 12 415 11 430 9 808
LSJH 58 535 63 051 69 185 74 507 76 189
YEQE 5 839 10 421 13 105 7 055 4 010
YEQF 215 640 239 107 267 952 293 342 299 741
YEQG 299 845 341 031 378 312 400 657 402 555
1998/99 1999/00 2000/01 2001/02 2002/03
15 367 13 370 13 370 13 370 13 370
9 561 12 709 10 046 11 336 14 290
75 021 72 857 74 750 73 299 75 527
6 556 3 823 3 024 8 946 14 736
294 594 293 109 282 786 273 559 281 420
401 099 395 868 383 976 380 510 399 343
2003/04 2004/05 Calendar years
13 370 13 370
18 494 16 918
77 544 78 805
19 187 20 196
313 897 351 001
442 492 480 290
1990 1991 1992 1993 1994
8 323 7 533 1 821 11 10 410
11 013 9 805 17 608 15 376 12 879
44 108 46 043 51 060 57 568 63 681
13 564 11 847 7 850 7 092 8 222
112 664 126 211 161 266 211 330 235 403
189 672 201 439 239 605 291 377 330 595
1995 1996 1997 1998 1999
12 478 14 286 12 375 13 390 19 451
13 139 12 192 10 778 9 902 9 121
67 831 74 904 76 299 75 355 74 109
19 610 5 913 4 176 4 369 3 568
259 110 291 185 306 111 304 830 299 952
372 168 398 480 409 739 407 846 406 201
2000 2001 2002 2003 2004
13 370 13 370 13 370 13 370 13 370
18 763 12 973 15 496 17 965 25 823
76 829 74 305 76 501 78 498 81 288
2 040 10 678 20 957 23 836 24 895
288 411 273 998 273 979 304 979 337 321
399 413 385 324 400 303 438 648 482 697
Financial years
M3
General Government Transactions in Maastricht Debt Instruments Consolidated Not seasonally adjusted (+ = increase in liabilities, - = decrease in liabilities)
£ million
Loans from central bank
Other loans
Currency and deposits
Bills and short-term bonds
Medium and long-term bonds
General govt. transactions in Maastricht debt instruments
1993/94 1994/95 1995/96 1996/97 1997/98
YEQK 3 688 9 143 –249 –1 332 –1 516
YEQL –2 915 –554 –625 –1 180 –520
NFSO 5 291 4 552 6 154 5 576 1 708
YEQN –1 850 4 583 2 736 –5 789 –2 920
YEQO 48 963 22 662 28 219 26 795 6 786
YEQR 53 177 40 386 36 235 24 070 3 538
1998/99 1999/00 2000/01 2001/02 2002/03
2 561 –1 997 – – –
–814 –861 –2 815 –1 680 3 172
–1 206 –1 810 2 505 –1 379 2 990
2 451 –2 626 –678 5 742 5 720
–6 521 217 –13 282 –9 156 7 558
–3 529 –7 077 –14 270 –6 473 19 440
– –
3 353 –551
2 610 1 223
4 445 1 009
31 603 37 794
42 011 39 475
1990 1991 1992 1993 1994
1 276 –790 –5 712 –1 811 10 400
29 –643 5 941 –2 288 –2 854
2 013 1 962 4 750 5 053 6 055
2 765 –2 000 –4 873 –447 1 069
–6 793 11 517 30 486 53 095 24 291
–710 10 046 30 592 53 602 38 961
1995 1996 1997 1998 1999
2 068 1 808 –1 911 1 015 6 062
–138 –1 225 –1 455 –318 –684
4 169 7 114 1 903 –1 002 –386
11 541 –13 504 –1 595 –26 –608
22 605 31 503 16 608 –3 290 –4 545
40 245 25 696 13 550 –3 621 –161
2000 2001 2002 2003 2004
–6 081 – – – –
5 496 –6 787 1 678 1 320 7 791
3 096 –2 809 2 126 3 482 2 589
–1 434 8 504 10 471 2 630 1 058
–12 517 –17 410 1 866 30 338 34 184
–11 440 –18 502 16 141 37 770 45 622
Financial years
2003/04 2004/05 Calendar years
M4
Reconciliation of General Government Net Borrowing with General Government Gross Consolidated Debt at Nominal Value Not seasonally adjusted
£ million
Consolidating General Net acquisition transactions in LESS Other Adjustment for Adjustment from Government Net of financial Maastricht debt accounts holding market to Other borrowing assets LESS Swaps instruments payable (F.7) gains/losses 1 nominal value 2 adjustments
Increase in general govt. gross consolidated debt at nominal value
Financial years 1993/94 1994/95 1995/96 1996/97 1997/98
-MDUK 51 062 45 375 36 855 29 576 7 912
NFPG 1 480 –5 831 27 –1 526 –2 033
-CFZG – – – – –
YEQP –612 –367 477 1 525 1 061
-NFVL –31 –108 –532 –1 954 –1 360
EYVC .. 716 320 –2 112 –981
YEQT .. .. –1 431 –855 –192
MDQA .. .. 2 519 741 –387
50 219 41 186 37 281 22 345 1 898
1998/99 1999/00 2000/01 2001/02 2002/03
–3 314 –14 325 –15 455 –418 21 964
2 600 8 893 27 180 –6 294 –3 836
– 55 265 –85 –390
2 103 1 424 621 807 –3 130
–145 –836 –24 689 1 210 –2 749
497 –547 801 –48 –197
1 289 1 830 1 644 1 949 1 380
–280 1 123 –1 017 1 027 –469
–1 456 –5 231 –11 892 –3 466 18 833
34 728 36 701
2 963 3 206
31 –139
–3 667 837
930 –4 100
–201 –20
–425 440
1 456 2 547
43 149 37 798
1996 1997 1998 1999 2000
32 054 17 799 –105 –10 364 –14 051
–6 427 578 –756 9 490 30 012
– – – – 185
678 1 836 1 098 2 228 987
391 –2 745 –418 981 –24 626
–2 036 –663 352 –662 429
–362 –128 1 370 2 574 2 000
3 370 –1 746 –1 238 –1 436 250
26 312 11 259 –1 893 –1 645 –6 788
2001 2002 2003 2004
–8 278 15 614 35 595 35 095
–10 912 –4 375 –192 7 448
102 –238 –136 –173
245 –2 090 –4 082 604
324 2 143 –1 242 1 252
141 –145 –120 –54
1 519 1 067 –1 125 118
3 260 –1 177 1 483 967
–14 089 14 979 38 345 44 049
2003/04 2004/05 Calendar years
1 (+) = holding gain, (-) = holding loss. 2 Market value minus nominal value.
M5
Reconciliation of General Government Gross Consolidated Debt at Nominal Value with National Accounts1 £ million 2001 /02
2002 /03
2003 /04
2004 /05
2000
2001
2002
2003
2004
GENERAL GOVERNMENT TOTAL FINANCIAL LIABILITIES NPVQ
496 088 528 641 561 636 607 775 526 540 500 386 519 691 548 113 601 395
LESS Other Accounts payable (F.7)
-NNMI
–46 942 –49 403 –50 358 –58 684 –41 416 –41 817 –39 673 –41 909 –44 182
General govt. gross unconsolidated debt at market prices
YEQQ
449 146 479 238 511 278 549 091 485 124 458 569 480 018 506 204 557 213
Consolidation Local govt. borrowing from central government Local govt. holdings of Treasury Bills Central govt. holdings of local govt. short-term debt Local govt. holdings of British central govt. securities
APDP NJEX NIFU NJFK
47 269 545 209 844
44 832 264 – 431
41 540 113 – 204
42 339 154 – 215
47 879 235 315 467
47 793 382 140 660
46 131 201 242 375
42 187 164 – 272
42 961 105 – 175
Total consolidation
MDQD
48 867
45 527
41 857
42 708
48 896
48 975
46 949
42 623
43 241
General govt. gross consolidated debt at market prices
MDQE
LESS British central government securities at market prices PLUS British central government securities at nominal prices General govt. gross consolidated debt at nominal prices2
400 279 433 711 469 421 506 383 436 228 409 594 433 069 463 581 513 972
-NIJI –291 019 –316 453 –338 788 –374 215 –315 462 –292 855 –306 140 –327 095 –366 419 BKPM 271 250 282 085 311 859 348 122 278 647 268 585 273 374 302 162 335 144 YEQG
380 510 399 343 442 492 480 290 399 413 385 324 400 303 438 648 482 697
1 Public Sector Finances consistent version of data. 2 General govt. gross consolidated debt as defined in the Maastricht Treaty.
M6
Reconciliation of Transactions in Maastricht Debt Instruments with National Accounts1 £ million 2001 /02
GENERAL GOVERNMENT TRANSACTIONS IN FINANCIAL LIABILITIES LESS Other Accounts payable (F.7)
NFSK -NFVL
2002 /03
2003 /04
2004 /05
–6 876 19 059 37 414 44 412 1 210 –2 749
2000
2001
2002
2003
2004
14 173 –18 581 11 908 34 930 44 974
930 –4 100 –24 626
324
2 143 –1 242
1 252
–5 666 16 310 38 344 40 312 –10 453 –18 257 14 051 33 688 46 226
General govt. unconsolidated transactions in Maastricht debt instruments
MDQF
Consolidation Local govt. borrowing from central govt. Local govt. transactions in Treasury Bills Central govt. transactions in local govt. short-term debt Local govt. transactions in British central govt. securities
ABEC NBZA NASF NBZN
–106 –2 437 –3 290 439 –281 –152 – – – 474 –412 –225
784 41 – 12
1 400 –218 – –195
–65 –1 685 –3 943 119 –141 –38 – – – 191 –264 –101
760 –59 – –97
Total consolidating transactions
YEQP
807 –3 130 –3 667
837
987
245 –2 090 –4 082
604
General govt. consolidated transactions in Maastricht debt instruments
YEQR
1 Public Sector Finances consistent version of data.
–6 473 19 440 42 011 39 475 –11 440 –18 502 16 141 37 770 45 622
M7
Government Deficit under the Maastricht Treaty Reconciliation of versions of net borrowing Not seasonally adjusted
£ million
Spectrum Use Adjustments Net borrowing General General Gross as a Net borrowing Net borrowing government General government domestic percentage of as a as a net borrowing government net borrowing product (GDP) GDP (UK percentage of percentage of (UK National Swaps net borrowing adjusted cash (Eurostat at current National GDP (EDP GDP (Eurostat Accounts)2 adjustment (EDP version) accrued rent receipts version)3 market prices Accounts) 1 2 version)1 version) 1 3 4 Financial years 1993/94 1994/95 1995/96 1996/97 1997/98
-NNBK 51 062 45 375 36 855 29 576 7 912
-CFZG – – – – –
-MDUK 51 062 45 375 36 855 29 576 7 912
BKTK – – – – –
-LSNY – – – – –
LSNP 51 062 45 375 36 855 29 576 7 912
BKTL 652 820 689 767 729 808 773 146 824 044
7.8 6.6 5.0 3.8 1.0
7.8 6.6 5.0 3.8 1.0
7.8 6.6 5.0 3.8 1.0
1998/99 1999/00 2000/01 2001/02 2002/03
–3 314 –14 380 –15 720 –333 22 354
– 55 265 –85 –390
–3 314 –14 325 –15 455 –418 21 964
– – 806 1 044 1 044
– – –22 477 – –
–3 314 –14 325 –37 126 626 23 008
870 464 921 762 965 041 1 006 523 1 062 954
–0.4 –1.6 –1.6 – 2.1
–0.4 –1.6 –1.6 – 2.1
–0.4 –1.6 –3.8 0.1 2.2
2003/04 34 697 2004/05 36 840 Calendar years
31 –139
34 728 36 701
1 045 1 044
– –
35 773 37 745
1 121 488 1 175 820
3.1 3.1
3.1 3.1
3.2 3.2
1990 1991 1992 1993 1994
8 849 18 222 39 421 50 932 46 149
– – – – –
8 849 18 222 39 421 50 932 46 149
– – – – –
– – – – –
8 849 18 222 39 421 50 932 46 149
557 300 586 000 610 562 641 691 680 441
1.6 3.1 6.5 7.9 6.8
1.6 3.1 6.5 7.9 6.8
1.6 3.1 6.5 7.9 6.8
1995 1996 1997 1998 1999
42 001 32 054 17 799 –105 –10 364
– – – – –
42 001 32 054 17 799 –105 –10 364
– – – – –
– – – – –
42 001 32 054 17 799 –105 –10 364
718 383 763 561 810 601 860 520 905 438
5.8 4.2 2.2 – –1.1
5.8 4.2 2.2 – –1.1
5.8 4.2 2.2 – –1.1
2000 2001 2002 2003 2004
–14 236 –8 380 15 852 35 731 35 268
185 102 –238 –136 –173
–14 051 –8 278 15 614 35 595 35 095
545 1 044 1 044 1 045 1 044
–22 477 – – – –
–35 983 –7 234 16 658 36 640 36 139
953 576 996 758 1 048 456 1 105 919 1 164 439
–1.5 –0.8 1.5 3.2 3.0
–1.5 –0.8 1.5 3.2 3.0
–3.8 –0.7 1.6 3.3 3.1
1 Net borrowing as a percentage of GDP is calculated by dividing net borrowing by non seasonally adjusted GDP. 2 Version used in UK Public Sector Finances, using equivalent formulae to UK National Accounts, classification of spectrum use as rent. Net borrowing is equivalent to negative net lending 3 Version used by Eurostat, classification as sale of asset. -LSNP= MDUKBKTK+LSNY 4 The Eurostat decision has wider implications for the National Accounts System. These will affect the level of net borrowing and GDP. These wider implications have been ignored in the construction of this measure.
M8R
Government Deficit and Debt Under the Maastricht Treaty General government net borrowing
General government Gross domestic gross consolidated product (GDP) at Net borrowing as a debt at nominal value current market prices percentage of GDP
-MDUK
YEQG
Gross consolidated debt as a percentage of GDP
BKTL
YEQJ
1992/93 1993/94 1994/95 1995/96 1996/97 1997/98
0 0 0 0 -19 -32
0 0 0 -11 0 0
-16 -67 65 1150 -261 1226
0 0 0 -0.1 0 0
0 0 0 -0.1 0 0
1998/99 1999/00 2000/01 2001/02 2002/03 2003/04
-76 115 -107 -423 -1236 -679
0 0 0 0 0 1250
2021 2685 3177 2441 4994 3884
0 0 0 0 -0.1 -0.1
-0.1 -0.2 -0.1 -0.1 -0.1 0
1990 1991 1992 1993
0 0 0 0
0 0 0 0
0 0 0 0
0 0 0 0
0 0 0 0
1994 1995 1996 1997
0 0 -17 -35
0 0 1 0
0 0 951 463
0 0 0 0
0 0 -0.1 -0.1
1998 1999 2000 2001
418 -980 368 -518
0 0 0 0
1904 2271 3015 2449
0.1 -0.1 0 0
-0.1 -0.1 -0.1 -0.1
2002 2003 2004
-1416 -337 -754
0 1252 1257
4311 4678 6413
-0.1 -0.1 -0.1
-0.1 0 -0.1
