Portugal deficit at 6.4 percent, exceeding target

Demonstrators shout slogans during a protest march marking Portuguese national youth day Wednesday, March 27, 2013 in Lisbon. The demonstration was organized by workers unions under the slogan "We Want Work with Rights". Poster reads "Against the right-wing policy". (AP Photo/Armando Franca)

LISBON, Portugal (AP) — Portugal's budget deficit last year was 6.4 percent, higher than the target of 5 percent after European authorities refused to include proceeds from a privatization in the deficit calculation.

The National Statistics Institute said Thursday the deficit jumped from 4.4 percent in 2011 because that year the government transferred private banks' pension funds to the Treasury, temporarily improving public finances.

The government has said the 2012 deficit would have been 4.9 percent of GDP if the European Union's statistical office had accepted the inclusion of 3.1 billion euros ($4 billion) from the privatization of airport management company ANA and other one-off financial operations.

Portugal needed a 78-billion-euro bailout two years ago and is struggling to restore its financial health amid a steep recession.