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. but Jan numbers discouraging
Wednesday, March 05, 2008
The central government racked up a near-$43 billion fiscal deficit for the 10 months to January 31 this year, although the negative balance was $1.3 billion better-than-programmed.
Based on the initial budget estimates, January was supposed to yield a small surplus - $155 million - but instead a deficit of $2.6 billion was made during the tenth month of the current fiscal year, largely reflecting previously committed additional spending that was revealed and tacked on to the budget when the administration was changed in October.
Senator Don Wehby said that the government is likely to make its target deficit of 5.5 per cent of GDP (see related story on Page 10).
But only $5.5 billion of the $15 billion in additional spending was added to the budget, or at least the programmed amount, between November and January.
What's more, is that taxes have been running behind budget over the last three reported months. Between November and January, the government collected $62.4 billion in revenue, or $1.8 billion less than budgeted back in April last year.
Tax collections have fallen short each of the three months, mainly because of lower-than-expected revenues from tax on interest, although for the month of January PAYE fell short of target by $641 million.
Last April when the first budget projections for the current fiscal year, which ends March 31, was made, then finance minister Dr Omar Davies had expected a deficit of 4.5 per cent of GDP, or a negative fiscal balance of $35 billion.
For the current administration to make its target deficit of approximately $47.5 billion, it has to make a surplus of $4.5 billion over the next two months.
Based on the January numbers, the government will have to make its revenue target and keep the additional spending for the rest of the fiscal year at below $4.6 billion and not the $9.5 billion more that has been programmed.
Wednesday, March 05, 2008
The central government racked up a near-$43 billion fiscal deficit for the 10 months to January 31 this year, although the negative balance was $1.3 billion better-than-programmed.
Based on the initial budget estimates, January was supposed to yield a small surplus - $155 million - but instead a deficit of $2.6 billion was made during the tenth month of the current fiscal year, largely reflecting previously committed additional spending that was revealed and tacked on to the budget when the administration was changed in October.
Senator Don Wehby said that the government is likely to make its target deficit of 5.5 per cent of GDP (see related story on Page 10).
But only $5.5 billion of the $15 billion in additional spending was added to the budget, or at least the programmed amount, between November and January.
What's more, is that taxes have been running behind budget over the last three reported months. Between November and January, the government collected $62.4 billion in revenue, or $1.8 billion less than budgeted back in April last year.
Tax collections have fallen short each of the three months, mainly because of lower-than-expected revenues from tax on interest, although for the month of January PAYE fell short of target by $641 million.
Last April when the first budget projections for the current fiscal year, which ends March 31, was made, then finance minister Dr Omar Davies had expected a deficit of 4.5 per cent of GDP, or a negative fiscal balance of $35 billion.
For the current administration to make its target deficit of approximately $47.5 billion, it has to make a surplus of $4.5 billion over the next two months.
Based on the January numbers, the government will have to make its revenue target and keep the additional spending for the rest of the fiscal year at below $4.6 billion and not the $9.5 billion more that has been programmed.