Government deficit lowered

The shortfall between the government’s recurrent revenue and total expenditure improved by €39.8 million to €196 million in the first four months of this year, when compared to the corresponding period last year.

The National Statistics Office said that the reduction in government deficit by 16.9 per cent was brought about by a rise in recurrent revenue of €25.2 million together with a drop in expenditure of €14.5 million.

In the period under review, recurrent revenue was recorded at €690.2 million. The comparative increase of 3.8 per cent was mainly triggered by higher returns from income tax (+€24.3 million) and value added tax (+€18.4 million).

On the other hand, declines in recurrent revenue were registered in social security (-€8.2 million), licenses, taxes and fines (-€7 million), and grants (-€5.9 million).

Compared to January-April 2009, total expenditure stood at €886.2 million, down by 1.6 per cent, as a result of lower outlays on capital and on recurrent expenditure.

Despite an increase in expenditure on social security benefits of €15.8 million, and the reclassification of the Malta Tourism Authority (which shifted €13 million from capital to recurrent expenditure), recurrent expenditure went down by €4.4 million, totalling €743.2 million.

These increases were outweighed by lower spending on the shipyards' voluntary retirement schemes (-€17.4 million), medicines and surgical materials (-€14.5 million) and street lighting and other services (-€5.6 million).

A fall of €11 million was also registered in capital expenditure. This was mainly the result of the reclassification of the Malta Tourism Authority, and a decline in film industry incentives by €5.6 million.

These were partly offset by an increase of €6 million in the external borders Fund.

The interest component of the public debt servicing costs rose marginally from €72.5 million in January-April 2009 to €73.4 million this year.

At the end of April, the government’s debt outstanding stood at €3,992.8 million, an increase of €237.8 million when compared to the corresponding month last year.

Long-term borrowing went up by €291.4 million whereas short-term securities fell by €43.2 million.

Concurrently, foreign borrowing declined by €13.2 million. The euro coins issued in the name of the Maltese Treasury edged up by €4 million and totalled €37.4 million when compared to the euro coin stock as at the end of April last year.