€895 million deficit in past 6 months

COVID-19 leaves a toll on aggregate expenditure

Miguela Xuereb

An increase in expenditure and a decrease in revenue has resulted in a government consolidated fund deficit of €895.6 million in the first half of 2020, the National Statistics Office (NSO) has reported.

Between January and June 2020, total expenditure amounted to €2,715 million, 17% higher than the corresponding period in 2019, while recurrent expenditure totalled €2,235 million (an increase of €228.1 million). The main contributor to this increase was a €111.2 million rise reported under Programmes and Initiatives, with the main developments involving added outlays towards Medicines and surgical materials (€43.6 million) and social security benefits (€43.3 million, of which €13.6 million were spent on social benefits related to COVID-19). 

By the end of June 2020, recurrent revenue declined by €345.2 million, totalling €1,819.3 million. This represents a 15.9% drop in comparison to the revenue reported during the first six months of 2019. Income Tax exhibited the largest decrease (€128.2 million), followed by  Value Added Tax (€86.5 million).

Debt stands at €6.37 billion

By the end of June, Central Government debt stood at €6,376.6 million, an €895.7 million rise from June 2019. Increases reported under Treasury Bills (€522.2 million) and Malta Government Stocks (€379.9 million) were the main reasons behind the rise in debt.

In contrast, lower debt was registered under the 62+ Malta Government Savings Bond (€2.9 million) and Foreign Loans (€0.1 million). Higher holdings by government funds in Malta Government Stocks also resulted in a decrease in debt of €7 million.