The White House submitted its revised financial outlook and budget priorities to Congress for fiscal 2012 and beyond, predicting that the federal deficit for 2011 will be 20 percent lower, at $1.316 trillion, than projected in February, but acknowledging a number of economic hurdles lie ahead.

Citing a combination of lower outlays and higher-than-anticipated receipts, the 2011 deficit is projected to equal to 8.8 percent of gross domestic product (GDP), down from 10.9 percent projected in February, the President’s “Mid-Session Report” said. Deficits are also expected to be lower in each of the next 10 years than estimated in the President’s February budget.

Outlays for fiscal 2011 are now estimated to be $3.63 trillion, $189 billion lower than originally estimated in February.

Discretionary appropriations, are expected to fall by $58 billion in fiscal 2011 and increase by $6 billion over the next 10 years, the report said, noting the Departments of Defense, Education, Energy and Homeland Security show significantly lower outlays in 2011 than projected in the February budget.

Over the next 10 years, spending for security programs rises by $51 billion, which is offset by decreasing non-security related programs of $45 billion from 2012 to 2012.

For the fiscal year 2012, which starts October 1, federal spending outlays have decreased by $59 billion in 2012 and by $832 billion over 10 years, the report said, compared to the February budget release. These changes are largely the effect of the caps on future discretionary budget authority enacted in the Budget Control Act.