The government deficit in the first seven months of the year fell by 12.6 per cent over the same period last year.

Recurrent revenue and expenditure rose by €105.8 million and €59.3 million respectively and the deficit went down from €368.6 million to €322.1 million, according to figures published by the National Statistics Office.

The 9.2 per cent rise in recurrent revenue, which totalled €1,251 million, was the result of a €25.5 million increase in income tax returns and an additional €23.4 million in grants, €23.2 million in Customs and excise duty, €13.2 million in miscellaneous receipts, €11.9 million in rent and €10.9 million in social security.

Revenue from licences, taxes and fines, on the other hand, dropped by €7.2 million.

The higher recurrent expenditure was caused by a €24 million increase in outlay on social security benefits, the relocation of €15.1 million to the Malta Tourism Authority from capital to recurrent expenditure and an €18.2 million rise in personal emoluments.

Spending on the shipyards’ voluntary retirement schemes and on medicines and surgical materials, on the other hand, fell by €17.5 million and €15.1 million respectively.

Capital expenditure went up by €24.3 million, mainly because of a €16.3 million rise in the European Union Cohesion Fund and an increase of €10 million related to the introduction of the Jeremie Financial Engineering Fund.

There were also transfers of €13.8 million to the Treasury Clearance Fund and of €8.6 million to the European Union Structural Fund.

These were in part outweighed by the reclassification of the MTA’s allocation.