The public debt picked up in may and exceeds 100% of GDP

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The debt of the public administrations as a whole recorded in may an increase of 1.9% compared to the previous month by summing 23.124 million euros more as a result of the crisis of the Covid-19, up to the maximum historical 1.257.818 million euros , which exceeds for the first time the 100% of GDP, according to data published this Friday by the Bank of Spain.

With respect to the same month of the previous year, the public debt has increased 5.5%, to add up in a year 65.616 million euros with respect to 1,192 billion euros registered in may of 2019.

In this way, the ratio of public debt to GDP would have been located in greater above 100% of GDP , around a percentage point more than the ratio estimated in the last month.

This increase of debt in may was due to the increase of the indebtedness of both the State and the autonomous communities, local authorities and Social Security, who have had to make an extra effort of spending due to the impact of the crisis of the coronavirus, as a result of the establishment of the state of alarm on the 14th of march, and the royal decrees enacted to address the crisis.

In particular, the debt of the General Administration of the State marked a historic maximum, along with the Social Security, which is also at maximum, but the debt also grew up in autonomous communities and local corporations.

So, the State debt rose in may in 22.657 million euros with respect to the month of April , up to the maximum of 1,121 billion euros, 2% more, and compared to the previous year escalated by 6.7%, adding more than 70.400 million in the last 12 months.

Meanwhile, the public debt of the autonomous communities also rebounded in may, although less than that of the State, with an increase compared to April of 1.225 million euros, 0.4%, up to the 302.082 million. In a year, the debt-regional has grown 1%.

In turn, the local governments raised also in a 0.9% of its debt in the month of may, until the 24.438 billion euros, but fell 6.1% in the interannual rate.

finally, the government debt to the Social Security rose in may to the 60.024 billion (5,000 million more than in the previous month), so that continued in the historical record. Level year-on-year grew by 28%, adding 13.203 million euros in just a year.

This rise in debt is due to loans that have been granted the State Social Security in the last few years to ensure the payment of pensions, whose monthly bill is about currently about 9.700 million euros, but in the months in which there is extra pay, it doubles.

According to estimates by the Bank of Spain, in the scenario of more moderate fall in GDP for the crisis of the Covid-19, the ratio of public debt will rise to around 115% of GDP , while in the more adverse could exceed the 120% of GDP.

The public debt closed 2019 at 1.18 trillion, equivalent to 95.5% of GDP, below the target that had marked the Government of the 95,9% of the GDP. For this year, the Government set a goal of reduction to the 94,65 of GDP, however, as a result of the crisis of the Covid-19 has been updated to rise the budget to 115,5 per cent of GDP.