Economic Council: treasury is short of assets

The state treasury has net assets of minus DKK 500 million this year, and that is a cause for concern.

In this respect, the treasury is in a worse situation than in 2007 when the net assets were zero ahead of the international financial crisis in 2008.

So concludes the Economic Council’s spring report, published today.

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The negative net assets present a challenge for the treasury’s ability to maintain a steady expenditure performance in a potential economic downturn, according to the report.

The treasury’s net assets either need to be big enough to cover deficits without the need for loans, or the finances must be so strong that the strong credit rating enables lending to cover deficits during an economic downturn.

Considering the state of the market and record-low unemployment figures, the state budget ought to show a much bigger surplus than it does, the report concludes.