Government deficit lower than pre-2013 levels

In January 2024 the Government deficit was €82 million, which is well below the €129 million deficit that was registered in the same month of 2012.

Although the Government continues to increase public investment and offer unprecedented support to households and businesses, last January the deficit of the Consolidated Fund almost fell by a third. In fact, compared to a year ago, the Government deficit improved by €39 million.

In the first month of 2024 the Government deficit was €82 million, which is well below the €129 million deficit that was registered in the same month of 2012, before the change in administration took place. Under the last administration led by Prime Minister Lawrence Gonzi, the deficit in the month of January averaged €105 million, or a third more than the deficit observed in January this year. One must note that the economy today is twice as large than it was at that time, meaning that the effective burden of the deficit was even worse then.

In 2009, when Malta was experiencing an international economic shock less acute than the present one, the deficit was €136 million. At the time the Government burdened families and businesses with higher electricity bills and fuel prices above the European average, in sharp contrast with the current administration’s stable energy and fuel price policy.

Despite international challenges, the Maltese economy is growing strongly, with government revenues rising by €94 million in the first month of 2024. Income tax revenues increased by €31 million, or by 20%. There was an increase of €11 million in social security contributions, €8 million from VAT, €12 million from licences, and €11 million from customs. In addition, there was an improvement of €12 million from grants.

In the first month of the year the Government carried out a record €21 million in capital expenditure, an increase of €6 million compared to a year earlier. This increase was due to further investment in roads.  The recurrent expenditure rose by €44 million, much of which was because of higher rates for social benefits.

Photo: Shutterstock

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