Deficit down by €70 million in first eight months 2013

The shortfall between recurrent revenue and total expenditure of central government amounted to €196.9 million in the first eight months of 2013, down from €267.6 million in the corresponding period last year.

An increase of €132.9 million in recurrent revenue outweighed the added expenditure of €62.2 million, resulting in a reduction of €70.7 million in the government deficit.

During January-August 2013, recurrent revenue stood at €1,837.8 million, up by 7.8 per cent over last year.

The main contributors to this increase were Income Tax (+€76.5 million), Grants (+€67.5 million) and Social Security (+€26.1 million). Conversely, lower proceeds were recorded from Miscellaneous Receipts (-€38.9 million) and Licenses, Taxes and Fines (-€12.1 million).

Total expenditure was recorded at €2,034.7 million, up by 3.2 per cent when compared to the corresponding period in 2012. This was primarily due to added outlays on recurrent expenditure. Recurrent expenditure increased by €69.2 million, mainly as a result of higher spending on programmes and initiatives and on personal emoluments, by €39.6 million and €25.2 million respectively.

The Programmes and Initiatives category advanced by 3.9 per cent, primarily on account of a rise in social security benefits (+€17.8 million), the social security state contribution (+€7.9 million), which also features as revenue, and EU own resources (+€7.7 million).

In addition, both the feed-in tariff and expenditure on the electoral commission went up by €4.5 million and €3.7 million respectively.

Contributions to government entities added €5.9 million, while the operational and maintenance expenditure declined by €1.5 million.

Expenditure on Government's capital projects amounted to €218.5 million. The increase of €8.1 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 in 2012. This increase was partially offset by declines recorded in the contribution towards the Treasury Clearance Fund (-€18.0 million), road construction (-€6.9 million), film industry incentives (-€4.8 million) and the ICT core services agreement (-€4.9 million).

During the period under review, the interest component of the public debt servicing costs registered an increase of €1.1 million and was recorded at €148.6 million.

At the end of August, Central Government debt stood at €5,066.9 million, up by €234.1 million over the corresponding period last year.

This was the result of higher long-term and short-term borrowing, which added €143.2 million and €100.1 million respectively. On the other hand, foreign borrowing went down by €11.9 million. As a result of consolidation, higher holdings by government funds in MGSs brought about a decline in debt of €2.5 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 August 2012, and totalled €54.2 million.