Deficit at €342 million for January-November 2012

During the first eleven months, central government recorded a deficit of €342.0 million, up from €278.2 million registered in the corresponding period last year.

The widening in the government deficit by €63.8 million was the result of an increase in total expenditure of €195.8 million, which outweighed the rise in revenue of €132.0 million, as shown in Table 1.

During January-November 2012, recurrent revenue stood at €2,366.0 million, up by 5.9 per cent over last year. This was mainly due to higher proceeds from Income Tax by €98.0 million.

Other increases in revenue were recorded in Miscellaneous Receipts (+€26.9 million), Social Security (+€19.9 million), Grants (+€14.0 million) and Value Added Tax (+€10.7 million), among others. These were offset in part by lower returns from Customs and Excise Duties (-€34.2 million), the Central Bank of Malta (-€6.0 million) and Fees of Office (-€3.2 million).

Compared to 2011, total expenditure went up by 7.8 per cent to €2,708.1 million, as a result of higher spending on all expenditure components.

Recurrent expenditure rose by €127.7 million. The major increase was recorded in Programmes and Initiatives by €89.7 million, as a result of higher social security benefits (+€42.6 million), medicines and surgical materials (+€9.0 million), social security state contributions (+€7.2 million), which also feature as revenue, assistance to help the elderly live independently (+€3.6 million), expenditure on solid waste management (+€3.0 million) and EU own resources (+€2.8 million). Added expenditure was also recorded on Personal Emoluments (+€18.1 million), Contributions to Government Entities (+€13.9 million) and Operational and Maintenance Expenditure (+€5.9 million).

Expenditure on Government's Capital Projects was registered at €305.2 million. The increase of €56.0 million over the corresponding period last year 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, the Ministry for Infrastructure, Transport and Communication and the Office of the Prime Minister went up by €14.2 million, €12.0 million and €3.5 million respectively. Moreover, higher outlays were recorded in Investment Incentives (+€4.8 million) and in the contribution towards the Treasury Clearance Fund (+€4.7 million).

During the period under review, the interest component of the public debt servicing costs totalled €204.8 million, an increase of €12.1 million over the comparable period last year.

At at the end of November, central government debt stood at €4,756.6 million, up by €200.9 million, or 4.4 per cent, over the corresponding period last year. This was the result of higher long-term borrowing, which added €300.7 million. On the other hand, short-term securities declined by €71.7 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 €5.4 million when compared to the coin stock as at the end of November 2011, and totalled €50.1 million.