Deficit up to €322.5 million in January-October 2012

An increase in recurrent revenue of €162.9 million was offset by a rise in total expenditure of €195.8 million, widening the government deficit by €32.9 million, as shown in Table 1.

During January-October 2012, recurrent revenue stood at €2,138.7 million, a rise of 8.2 per cent over last year. This increase was mainly triggered by higher proceeds from Income Tax by €108.1 million.

Other increases in revenue were recorded in Miscellaneous Receipts ( €28.8 million), Value Added Tax ( €26.2 million), Social Security ( €18.0 million) and Grants ( €15.0 million). These were partly outweighed by lower returns from Customs and Excise Duties (-€25.0 million), the Central Bank of Malta (-€6.0 million) and Fees of Office (-€4.1 million).

Compared to 2011, total expenditure went up by 8.6 per cent to €2,461.2 million, as a result of added spending on all expenditure components.

Recurrent expenditure rose by €125.0 million. The major increase was recorded in Programmes and Initiatives by €88.3 million, mainly as a result of higher social security benefits ( €40.2 million), medicines and surgical materials ( €7.8 million), EU own resources ( €6.6 million), contribution to church schools ( €3.9 million) and assistance to help the elderly live independently ( €3.6 million).

Added expenditure was also recorded in Personal Emoluments ( €16.6 million), Contributions to Government Entities ( €10.6 million) and Operational and Maintenance Expenditure ( €9.5 million).

Expenditure on Government's Capital Projects was registered at €270.3 million. The increase of €61.3 million over the corresponding period in 2011 includes an equity injection of €20.0 million to the national air carrier.

Expenditure financed by EU funds related to the Ministry for Resources and Rural Affairs and the Ministry for Infrastructure, Transport and Communication, went up by €13.7 million and €13.6 million respectively, whereby the latter included works on road infrastructure. Moreover, higher outlays were recorded in Investment Incentives ( €5.5 million), in the contribution towards the Treasury Clearance Fund ( €4.7 million) and in film industry incentives ( €3.1 million).

During the period under review, the interest component of the public debt servicing costs totalled €185.6 million, an increase of €9.6 million over the comparable period last year.

As illustrated in Table 3, at the end of October, Central Government debt stood at €4,619.9 million, up by €235.2 million, or 5.4 per cent, over the corresponding period last year. This increase was the result of higher long-term borrowing, which added €328.7 million. On the other hand, short-term securities declined by €64.7 million and foreign borrowing went down by €12.7 million.

Moreover, as a result of consolidation, higher holdings by government funds in MGSs resulted in a reduction of €20.7 million. The euro coins issued in the name of the Maltese Treasury went up by €4.7 million when compared to the coin stock as at the end of October 2011, and totalled €49.3 million.