In the first four months of 2010, the shortfall between recurrent revenue and total expenditure of Central Government improved by €39.8 million to €196.0 million when compared to the corresponding period last year.

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.

During 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 from 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 (-€7.0 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 €13.0 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 €11.0 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 €6.0 million in the External Borders Fund. As shown in Table 1, 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 2010, the Central Government 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 €4.0 million and totalled €37.4 million when compared to the euro coin stock as at the end of April 2009.

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