Deficit down by €43.6 million in first five months 2013

During the first five months this year, the shortfall between recurrent revenue and total expenditure of Central Government amounted to €190.8 million, down from €234.4 million in the corresponding period last year.

An increase of €88.1 million in recurrent revenue outweighed the added expenditure of €44.5 million, resulting in a reduction of €43.6 million in the government deficit.

During January-May, recurrent revenue stood at €1,096.1 million, up by 8.7 per cent over last year. This increase was mainly due to higher proceeds from Grants (+€53.1 million), Income Tax (+€35.1 million) and Social Security (+€13.7 million). These were partially offset by lower returns from the Central Bank of Malta (-€12.0 million), Customs and Excise Duties (-€7.0 million) and Dividends on Investments (-€5.2 million).

Compared to 2012, total expenditure amounted to €1,286.9 million, up by 3.6 per cent, as a result of added outlays on capital and recurrent expenditure.

Recurrent expenditure increased by €11.0 million, mainly as a result of higher outlays on personal emoluments and contributions to government entities, by €14.2 million and €13.2 million respectively. Despite an increased outlay of €9.4 million on social security benefits, programmes and initiatives registered a decline of €8.4 million compared to the first five months last year. Moreover, operational and maintenance expenditure went down by €8.1 million.

Expenditure on Government's capital projects amounted to €157.8 million. The increase of €33.5 million over the corresponding period last year includes an equity injection of €40.0 million to the national air carrier, up from €20.0 million last year. Moreover, the contribution towards the Treasury Clearance Fund added €14.0 million and expenditure on road construction went up by €3.9 million. Conversely, declines were registered in investment incentives and the ICT core services agreement, by €3.3 million and €1.2 million respectively.

During the period under review, the interest component of the public debt servicing costs registered a marginal decrease and was recorded at €91.8 million.

At thee end of May, Central Government debt stood at €5,064.5 million, up by €439.0 million over the corresponding period last year. This was the result of higher short-term and long-term borrowing, which added €352.9 million and €87.7 million respectively. On the other hand, foreign borrowing went down by €11.4 million.

As a result of consolidation, lower holdings by government funds in MGSs resulted in an increase in debt of €4.3 million. The euro coins issued in the name of the Maltese Treasury went up by €5.5 million when compared to the coin stock as at the end of May 2012, and totaled €51.7 million.