Historical record of public debt: €1.35 trillion
The State finished 2020 with a debt of 120% of GDP
BarcelonaThe impact of the pandemic on the State's public accounts is undeniable. The measures adopted by the State have brought the the public deficit to 11% of GDP, bordering on the historical record. But, in addition, the state debt has reached another historical record in 2020: €1.35 trillion, 120% of GDP, according to data published on Tuesday by the Bank of Spain. The pandemic has shattered the objectives of the beginning of the year, when the Spanish government was set to end the year with a debt of 94.65% of GDP, after finishing 2019 at 95.5%.
These are the data for public administrations' debt - state, communities, local corporations and Social Security - which do not include the debt of the Sareb, the so-called "bad bank" which was created to clean up real estate assets from the previous crisis. With Sareb's €34bn debt, the indebtedness of the State is far from the goal that had been set, and that was notified in Brussels last October, ending the year with a debt of 118.8% of GDP.
In absolute terms, Spanish public debt grew by 13.2% in 2020, as it went from €1.189 trillion to €1.345 trillion, a growth of €156,725 million during the year.
Looking at different administrations, the debt only fell in absolute terms in local corporations, while it increased in the State administration, the regions and the Social Security. Thus, central government debt reached €1.206 trillion in December last year, 107.6% of GDP, with an increase of 13.7%. The growth of the debt of this subsector in 2020 was €145,541 million, of which more than €34bn are due to Sareb's reclassification.
The upturn in central government debt also includes the transfer of €16bn through covid-19 funds to the autonomous communities to finance and cover expenses in health, education and aid to groups affected by the measures against the pandemic. On the other hand, regional government's debt grew to €304bn, equivalent to 27.1% of GDP, with a year-on-year increase of 2.9%.
Local corporations reduced their debt by 5.5% at the end of 2020, to €22bn, representing 2% of GDP, according to the Bank of Spain.
Record in Social Security: 55% more
The debt of the Social Security reached €85bn, marking its all-time record. On a year-on-year basis it grew by 55.1%, increasing by €10.5bn in just one year. This increase is due to the loans granted by the State to the Social Security General Treasury to finance a significant part of its budgetary imbalance. These loans, however, do not affect the total debt of the general government sector.
