The net lending(+) / net borrowing (-) (also known as surplus/deficit) together with the gross debt of general government are among the most important indicators in government finance statistics. While in general government gross debt will increase in the presence of a government deficit, this is not necessarily the case in the short-term. Deficits can also be financed by the sale of an assets, or alternatively debt can be used to finance the acquisition of assets. Therefore, in addition to the surplus/deficit, a strong co-movement of net acquisition of financial assets exists with the evolution of quarterly debt. The incurrence of liabilities not covered in the Maastricht debt definition as stipulated in the excessive deficit procedure (mainly 'other accounts, payable') as well as valuation differences and discrepancies play a smaller role in explaining the change in debt.
Since the first quarter of 2020, deficits (non-seasonally adjusted) started increasing because of the COVID-19 containment measures and policy responses to mitigate the economic and social impact of those containment measures. This was in particular the case in the second quarter of 2020, where the highest deficit since the start of the series was recorded (-11.7% of GDP). The financing of the high deficits observed in the first three quarters of 2020, explain partly the increase in gross debt (44% for the second quarter of 2020). The net acquisition of financial assets explains further the debt increase. Notably, increases in deposits as well as other accounts receivables, the latter relating to the deferral of taxes and social contributions that were accrued as revenue but not yet paid, are observed. In the third quarter of 2020, the financing of the deficit explained the main part of the increase in debt.