Landshagir - 01.11.2011, Qupperneq 279

Public finance
LANDSHAGIR 2011 STATISTICAL YEARBOOK OF ICELAND 2011
15
279
Statistics Iceland compiles the annual
general government, central government,
and local government statistics, on an
accrual basis, in the context of the national
accounts based on the 1995 ESA and the
ESA95 Manual on Government Deficit and
Debt. The government sector comprises
those activities in the economy that are
mainly financed by tax revenue.
One of the main purposes of keeping
accounts of the general government is to
give an overview of its revenue, expendi­
ture, assets and liabilities and of its main
balances, i.e. the operating balance and net
lending/borrowing balance. The accounts
are produced in line with the IMF‘s GFSM
2001 standard on the government finances
(The Government Finance Statistics
Manual, 2001), the European System of
Accounts from 1995 (ESA95) and the Clas­
sification of the Functions of Government
(COFOG) issued by the United Nations.
The accounts are produced for the general
government as well as for its subsectors,
i.e. budgetary central government, social
security funds and local governments.
Financial balance of the general government
was ISK 155 billion in deficit
In 2010, the financial balance of the general
government was 155 billion ISK in deficit
or 10.1% of GDP, which can be compared
with a deficit of 10% of GDP for 2009. These
unfavourable results can be explained by a
drastic decrease in revenue due to an 11%
fall in GDP in 2009­2010 in real terms. At
the same time, the expenditure increased
heavily due to an increase in financial
liabilities and unemployment.
The general government total revenue
increased by 3.7% between 2009 and 2010
and amounted to 637 billion ISK in 2010
or 41.5% of GDP, compared with 41.0% in
2009, 44.1% in 2008 and 47.9% in 2007.
The general government total expenditure
increased as well by 3.7% between years
and amounted to 51.5% of GDP in 2010
compared with 51.0% in 2009 and 57.6% in
2008.
Total expenditure on health was 9.3% of GDP
In 2010, the total expenditure on health
was 9.3% of GDP, of which 80.5% was
financed by the general government and
the rest by households. The health expen­
diture per capita was 360 thousand ISK in
2010 a decrease of 24 thousand ISK from
2009. The total expenditure on educa­
tion was 8.3% of GDP, of which 91% was
financed by the general government.
Expenditure on education was 367 thou­
sand per capita ISK in 2010 and decreased
by 13 thousand ISK between years. The
total general government expenditure on
social protection in 2010 was 172 billion
ISK, 11.2% of GDP. Total expenditure on
social protection per capita amounted to
541 thousand ISK.
About 15.3% of general government total
expenditure goes to health affairs, 16.2% to
education and 21.7% to social protection.
In total, 53.2% of the general government
total expenditure goes to these functions
or 27.4% of GDP.
The general government net financial assets
were negative by 741 billion ISK in 2010
The general government net financial
assets, i.e. financial assets less liabilities,
were negative by 741 billion ISK in 2010
or 48.2% of GDP. The deterioration from
2010 is 144 billion ISK or 8.3% of GDP. The
general government total financial asset
amounted to 1,181 billion ISK at the end of
2010 (76.8% of GDP) and the total liabilities
1,921 billion ISK (125% of GDP).