The shortfall between government recurrent revenue and total expenditure during the first nine months of the year narrowed by Lm12.6 million, the National Statistics Office reported yesterday.

The shortfall between recurrent revenue and total expenditure amounted to Lm72.9 million during the January-September period. This corresponds to a reduction of 14.7 per cent over the same period last year, and is the result of higher revenue and comparatively lower expenditure on capital projects.

Recurrent revenue increased by Lm22.9 million during the first three-quarters of the year, mainly due to higher receipts from income tax , excise duties, social security contributions, licences, and VAT. At the same time there was a reduction in revenue from miscellaneous receipts, fees of office, the Central Bank of Malta, and from grants.

Recurrent expenditure amounted to Lm560.1 million, an increase of Lm16.7 million compared to the first nine months of 2005. This increase was brought about mainly by a Lm10.8 million rise in outlay on social security benefits. At the same time, expenditure on personal emoluments rose by Lm1.7 million, while contributions to government entities declined by Lm3.1 million.

Interest payments on public debt increased by Lm7.1 million, and amounted to Lm62.9 million.

During the survey period, capital expenditure fell by Lm13.4 million. Reductions were recorded in respect of the new hospital project, urban development and roads, and justice and home affairs. On the other hand, higher expenditure was registered under industry and information technology.

The Consolidated Fund took up Lm10 million worth of new loans during the first nine months of the year. From the total sale of Maltacom shares in May, which amounted to Lm94.5 million, a contribution of Lm74.2 million was made to the Consolidated Fund, with the balance of the proceeds being transferred to the Sinking Fund.

The outstanding debt of Central Government at the end of September totalled Lm1,376.8 million, a reduction of Lm14.2 million compared to the same month last year. This was the result of a reduction of Lm20.9 million in Treasury Bills, which was in part offset by an increase of Lm11.6 million in Malta Government Stocks.

Foreign borrowing and the ex-Malta Shipyards debt both declined by Lm3.1 million and Lm1.9 million respectively.