The annual deficit continued to expand in July, reaching €309 million according to figures issued yesterday by the NSO.

As the government strives to lower the deficit by the end of this year, mentioning a cut of €50 million, the increase registered in the first seven months of the year exceeded €50 million.

According to the NSO data, one of the main reasons contributing to higher spending is an additional €28 million in government wages and an increase of €25 million in contributions to State entities.

NSO data issued last week showed that, during the first 12 months of Labour in power, public sector employees increased by almost 2,000. This includes about 600 former Arriva workers, who have been absorbed by the public sector following the takeover of the public transport service by a government entity. The statistics office said yesterday that while government revenue grew by 5.7 per cent in the first seven months of the year, expenditure increased by 7.4 per cent.

The main contributors to the higher revenue were social security contributions (€33.7 million), income tax (€30.2 million) and VAT (€27 milllion). Revenue from Customs and excise duty fell by €22 million. On the expenditure side, which rose by €109 million , major increases were registered in social security State contribution, which also features as revenue (€10.1 million), public service obligations (€10 million), medicinal and surgical materials (€7.7 million) and contributions to Church schools (€3.6 million). Between January and July, Malta paid €131.9 million in interest on outstanding loans.

By the end of July, the country’s debt stood at €5.2 billion, an increase of €283.5 million over the same period last year.

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