The government posted a primary surplus of R$ 1,464 billion in March.

Mariana Branco - Reporter for Agência Brasil

In March, the Central Government – ​​which includes the accounts of the National Treasury, Social Security, and the Central Bank – recorded a primary surplus of R$ 1,463 billion. In February, there was a deficit of R$ 7,4 billion. The primary surplus is the public savings used to pay interest on the debt.

Despite being positive, the result is 54,3% lower than the surplus in March 2014, which was R$ 3,2 billion. In the accumulated period from January to March, there is a surplus of R$ 4,485 billion, a result 65,8% lower than the positive balance of R$ 13,1 billion registered for the same period in 2014.

The information was released today (29) by the National Treasury. Tomorrow (30), the Central Bank will release a broader fiscal result, including, in addition to the Central Government, the accounts of states, municipalities and state-owned companies.

In March, there was growth in Central Government revenues, which increased by R$ 5,6 billion, or 6,1%, compared to February, reaching R$ 97,4 billion. In addition, transfers from the Federal Government to states and municipalities decreased by R$ 6,9 billion (31,8%).

According to the Treasury, the decrease resulted from a reduction of R$ 4,4 billion (26,6%) in constitutional transfers, reflecting the collection of shared taxes such as Income Tax (IR) and Tax on Industrialized Products (IPI). The Treasury also stated that there was an influence from a decrease of R$ 1,8 billion, or 66,4%, in oil royalty transfers. Central government spending increased by R$ 3,6 billion, or 4,7%, when comparing February to March 2015.

Last month, the specific accounts of the National Treasury showed a surplus of R$ 8 billion, driving the positive monthly result of the Central Government. Meanwhile, Social Security and the Central Bank had deficits of R$ 6,5 billion and R$ 42,9 million, respectively.

National Treasury: Primary surplus shows trend reversal.

The Secretary of the National Treasury, Marcelo Saintive, said today (29) that the Central Government's primary surplus in March fell short of expectations, but is important because it shows a reversal of the trend. Last month, there was a surplus of R$ 1,463 billion. In February, there was a deficit of R$ 7,4 billion. The first quarter of 2015 recorded an accumulated surplus of R$ 4,48 billion.

The monthly surplus is 54,3% lower than the R$ 3,2 billion recorded in March 2014. The quarterly positive balance is 65,8% lower than the R$ 13,1 billion of the first three months of last year. Saintive admitted that revenues are falling due to the economic contraction. He also stressed that government expenses contracted in the previous year cannot be immediately eliminated. "[But] the message of this result is that we are moving towards a reduction," he said.

In March, total government spending amounted to R$ 81,132 billion. Spending registered a growth of 4,7% compared to February and an increase of 5,7% compared to March 2014. However, there was a reduction in investments from the Growth Acceleration Program (PAC). Spending on the program totaled R$ 2,961 billion last month, growing 8,5% compared to February of this year, but decreasing 32,5% compared to the same month in 2014.

Marcelo Saintive said he believes it is possible to reach the primary surplus target of 1,2% of Gross Domestic Product (GDP, the sum of goods and services produced in a country) this year. "We will pursue the target," he declared. In 2014, Brazil ended the year with the first primary deficit in history in the Central Government's accounts. The fiscal result was a deficit of R$ 17,2 billion.