Increased recurrent revenue improves deficit in 2011

Government deficit improves during the first 11 months of 2011 over 2010 as recurrent revenue registers an increase of €88.5 million which outweighed the increase of €58.8 million in expenditure.

At the end of November, Central Government debt stood at €4,555.7 million, up by €345.5 million, or 8.2%, over the corresponding period in 2010 resulting from higher long-term borrowing, which added €444.8 million.

On the other hand, short-term securities and foreign borrowing decreased by €90.1 million and €13.2 million respectively.

Between January  and November 2011, recurrent revenue stood at €2,234.0 million, up by 4.1% over last year according to NSO statistics.

The euro coins issued in the name of the Maltese Treasury went up by €4.3 million when compared to the euro coin stock as at the end of November 2010, and totalled €44.7 million.

Higher returns were mainly registered from Social Security (€36.9 million), Value Added Tax (€35.5 million) and Customs and Excise duties (€28.5 million). Conversely, a reduction in proceeds was recorded from Income Tax (-€28.2 million).

Total expenditure was recorded at €2,512.3 million, up from €2,453.5 million when compared to last year. This resulted from higher outlays on recurrent expenditure and interest payments, partly outweighed by a decline of 5.2% in capital expenditure.

The main contributors to the increase of €62.5 million in recurrent expenditure were, among others, contributions to government entities (€20.2 million), social security state contributions (€9.7 million), which also feature as revenue, personal emoluments (€9.4 million), contributions to church schools (€4.7 million) and medicines and surgical materials (€4.6 million).

Moreover, an increase in public service obligations (€3.6 million) and a higher administration fee to Transport Malta (€2.9 million) added to recurrent expenditure. Conversely, Social Security Benefits declined by €3.2 million during the period under review.

Capital expenditure was recorded at €249.2 million. The lower expenditure on capital projects, by €13.6 million, was triggered by the completion of the Malta South Sewage Infrastructure (-€33.5 million).

This was partly offset by higher outlays on the EU Agricultural Fund for Rural Development (€6.7 million), EU Cohesion Fund in the Ministry for Infrastructure, Transport and Communication (€6.3 million), the promotion of renewable energy (€4.6 million) and Tourism Zone Upgrading (€4.1 million).

The interest component of the public debt servicing costs for the 11 months under review went up by €9.9 million and amounted to €192.7 million.