Government finances remained under heavy pressure last year, with the country spending €1.2 billion more than it took in, numbers published today by the National Statistics Office (NSO) show. While the numbers show an improvement of 15 per cent over the record deficit registered in 2020 of €1.5 billion, the ballooning public sector wage bill raises serious concerns about sustainability.
The NSO report on public finances between January and December 2021 show that government spending rose from €5.9 billion in 2020 to €6.6 billion in 2021, an increase of €780 million, or 13.3 per cent.
According to the NSO, personal emoluments (wages and salaries) to public sector employees surpassed the €1 billion mark for the first time, increasing costs to taxpayers by as much as €116 million in just a year.
Additionally, the government pumped more money into its various entities, including authorities and agencies, increasing its contributions to €688 million, a jump of €67 million over 2020.
Government revenue increased by €1 billion, from €4.4 billion in 2020 to €5.4 billion in 2021 – an increase of 22.9 per cent, according to the NSO figures.
At the same time, government’s spending on projects (capital expenditure) was cut by €300 million to reduce costs.
The government’s heavy borrowing to cover its expenditure means interest payment rose to €184 million in 2021 from €181 million in 2020, and hiked national debt to €8.1 billion by the end of 2021. National debt has continued to rise this year, reaching €8.4 billion by the end of February.
During the last budget speech, Finance Minister Clyde Caruana said that Malta expects to lower its deficit to just 2.9 per cent of GDP in 2024.
Euro 1.2 billion deficit for 2021. Yet, the best part of the analysis, is that ‘this amount shows an improvement of 15% over the record deficit of Euro 1.5 billion in 2020’. So, even in a catastrophic economic performance, the Government boasts of negative records. The word ‘record’ is obviously what the PL Gahans will swallow, to boast of the greatness of their ‘Viva l-Lejbor’ They might even boast that in the last two years, the Government made a super record deficit of Euro 2.7 billion, and increased the National Debt to another super-record of Euro 8.1 billion in 2021, and Euro 8,4 billion by February 2022, as against the Euro 5 billion that the PN Government accumulated in 25 years, including the two years of Alfred Sant, when VAT was thrown down the drain.
This may become a ‘mantra’ repeated by the Lejboristi, as they were doing in praising the PL Government for taking us into the ‘grey listing’, something which, they said, the Nazzjonalisti never managed to achieve.
Another record highlighted by the National Statistics Office (NSO), is that wages and salaries in the Public Sector surpassed the amount of Euro 1 billion for the first time ever. I wonder what this amount will be at the end of 2022, with the hundreds, if not thousands, of new employees under the ‘votes for jobs election scheme’. The million-dollar question is how sustainable this is for our future economic performance, as this is not a one-time payment, like the Euro 77 million dished out in the ‘cheques for votes’ election scheme paid from the additional taxes, we taxpayers paid.
Projecting the end of this year is still early, as we still have to know how much the cabinet of gigantic proportions (many Chiefs and no Indians), together with a horde of new persons of trust and their families, and not least, the Prime Minister’s overtime hours are going to cost the hard-working taxpayer.
An eye-blinding future is ahead of us. LOL
muvument korrot jisraq flus il-haddiem onest.
IS-SUCESS TA’ L-AQWA FID-DINJA MMEXXIJJA MINN MUVUMENT KORROTT.
Barely missed the donkeycade.
I’M EARNESTLY LOOKING FORWARD, TO SEE HOW BOBBY IS GOING TO GET US OUT OF THIS FINANCIAL MESS HE GOT US INTO.👎
I WONDER IF THE GAHANISTY ARE PREPARED FOR A BIG SHAKE UP AFTER NEW RESTRICTION MEASURES ARE INTRODUCED TO LOWER NATIONAL DEBT. I DOUBT IT!!!👎
THANK GOD THE NATIONALIST DIDN’T GET ELECTED TO FACE THIS DISASTER!!👍
I am not wondering about the reaction of these labourites Even if Bobby introduces restrictive measures to lower our national debt they will still support him and his fellow MPS. They might complain, but in five years’ time everthing will be forgotten and they will re-elect them.Labour has a ‘permanent electoral majority’ which they can count on.