Data from the Consolidated Fund of the government for February shows that the shortfall between recurrent revenue and total expenditure amounted to Lm42.8 million, an increase of Lm2.7 million when compared to the shortfall of Lm40 million recorded for the first two months of 2006, the National Statistics Office reported yesterday.

Although recurrent revenue increased by Lm3.4 million, total expenditure increased by Lm6.1 million.

During the first two months, revenue from income tax increased by Lm4.3 million, while revenue from Customs and Excise duties and from rents added Lm1.6 million and Lm1.7 million respectively, compared to the same period in 2006. On the other hand, this year revenue from grants amounted to Lm0.04 million, whereas in 2006 Lm7.5 million was received.

Recurrent expenditure amounted to Lm128.2 million, an increase of Lm11.1 million compared to January and February 2006. During the first two months of this year, greater outlays were reported on medicines and surgical materials by the Health Ministry (+Lm4.2 million), on social security benefits (+Lm2.5 million, mainly on account of an increase of Lm1.9 million to retirement pensions), and on higher outlays by the Investment, Industry and Information Technology Ministry (+Lm2.9 million, mainly brought about by a comparatively higher expenditure under the “contributions to government entities” category).

The interest component of the public debt servicing costs for the January-February period amounted to Lm12.0 million, a decline of Lm1.7 million. This decline was the result of lower interest payments on the government’s long-term borrowing.

During the first two months of 2007, capital expenditure amounted to Lm10.3 million, registering a decline of Lm3.2 million compared to the expenditure of Lm13.5 million for January to February 2006. This decline was due in part to a reduction of Lm1.3 million and Lm0.9 million in capital outlay by the Tourism and Culture Ministry and by the Rural Affairs and the Environment Ministry respectively.

No new loans were taken up during the first two months of the year.

The central government debt outstanding at the end of February amounted to Lm1,364.1 million, a reduction of Lm28.9 million compared to the debt position at the end of February 2006. This decline was brought about by a reduction of Lm19.6 million in the short-term borrowing component, as well as by a reduction of Lm10.4 million in foreign borrowing.