In June, the federal government recorded its third-largest public deficit since the historical series began in 1997, posting a negative balance of R$45.22 (US$9.5) billion, according to data released by the National Treasury on July 27th, 2023.
The deficit from January to June amounted to R$41.26 billion, inflation-adjusted.
Over the last 12 months, the shortfall was 0.41% of the GDP, or R$41.5 billion.
The primary balance excludes debt interest payments, which is the difference between revenue (tax collection) and expenses.
June’s result was worse than the median deficit expectations of R$34.1 billion, as predicted by a survey conducted by the Ministry of Finance.
The National Treasury and the Central Bank reported a surplus of R$6.5 billion, while Social Security had a negative balance of R$51.7 billion.
In contrast, public accounts in June 2022 ended with a nominal surplus of R$14.6 billion.
The primary result for June 2023 can be attributed to a 26.1% real decline in net revenue and a 4.9% real increase in total expenditure.
Factors leading to the reduction in net revenue include the Eletrobras concession in June of last year, the payment of dividends by the National Bank for Social and Economic Development, and a decline in administered revenues.
The increase in expenditure was mainly due to the payment of social security benefits and Obligatory Expenses with Flow Control.
The cumulative result for the year concluded with a primary deficit of R$42.5 billion.
Net revenue fell by 5.3% (R$ 52.8 billion less) from January to May, while total revenue for the first half of 2023 decreased by R$ 62.5 billion.
Total expenses increased by 5.1%, or R$ 47.5 billion, from January to June 2023.