Deficit down by €43 million in first half 2013

In the first half of 2013, the shortfall between recurrent revenue and total expenditure of Central Government amounted to €241.2 million, down from €284.3 million in the corresponding period last year.

An increase of €104 million in recurrent revenue outweighed the added expenditure of €60.9 million, resulting in a reduction of €43.2 million in the government deficit.

During January-June, recurrent revenue stood at €1,307.5 million, up by 8.6 per cent over last year. This was mainly due to higher proceeds from Income Tax (+€60.8 million), Grants (+€59.1 million), Social Security (+€14.2 million) and Value Added Tax (+€8.5 million).

These were partially offset by Miscellaneous Receipts (-€20.2 million), lower returns from the Central Bank of Malta (-€6 million), Customs and Excise Duties (-€6 million) and Dividends on Investments (-€4.1 million).

Compared to 2012, total expenditure amounted to €1,548.7 million, up by 4.1 per cent, as a result of more outlays on all expenditure components.

Recurrent expenditure increased by €36.6 million, mainly as a result of higher outlays on personal emoluments (€17.2 million) and contributions to government entities (€9.5million). The Programmes and Initiatives category advanced by €13.6 million, mainly on account of a rise in social security benefits (+€15.1 million). Operational and maintenance expenditure declined by €3.7 million.

Expenditure on Government's capital projects amounted to €178.8 million. The increase of €22.4 million over the corresponding period last year includes an equity injection of €40 million to the national air carrier, up from €20 million last year. Moreover, expenditure on road construction went up by €3.2 million. Conversely, a decline of €1.8 million was registered in the ICT core services agreement.

During the period under review, the interest component of the public debt servicing costs registered an increase of €1.9 million and was recorded at €111.2 million.

At the end of June, Central Government debt stood at €5,045.3 million, up by €250.4 million over the corresponding period last year. This was the result of higher long-term and short-term borrowing, which added €79.8 million and €173.2 million respectively. On the other hand, foreign borrowing went down by €12 million. As a result of consolidation, lower holdings by government funds in Malta government stocks brought about an increase in debt of €4 million. The euro coins issued in the name of the Maltese Treasury went up by €5.2 million when compared to the coin stock as at the end of June 2012, and totalled €52.3 million.