fiscal balance

An accrual measure that shows whether the government has to borrow from financial markets to cover its activities. Fiscal balance is calculated as revenue net of expenses from operations, plus revaluation adjustments (to remove items that do not impact on the fiscal balance), plus capital adjustments. Net investment in non-financial assets worsens fiscal balance as such investment is integral to the operation of government. Related term: underlying cash balance.

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Last updated: 13 January 2016