01/12/2015 10:19
The fiscal balance of the general government registered a considerable deterioration during the first ten months of the year.
The return of Cyprus to a recovery path is not accompanied by a respective improvement of public finances, as there is a deterioration of revenues and a small increase in expenditures.
According to new data by Cystat, the fiscal surplus for the general government in the first ten months of 2015 amounted to €65 mn against a surplus of €287 mn last year.
In the first nine months of 2015 fiscal surplus amounted to €101 mn.
Central government revenues
The total public revenues fell by 4,8% or €258 mn in the first ten months of the year to €5.116 mn from €5.374 mn in the same period of 2014. The decline is partly attributable to the lower dividend granted by the Central Bank this year, as it stood at €133 mn from €189 mn last year.
Direct taxes fell by €117 mn while indirect taxes increased by €12 mn mainly due to higher social security contributions which were up by €16 mn.
As a result tax revenue was down by €88 mn.
Non-tax revenues decreased by €122 mn mainly due to the lower central bank dividend, bringing the current revenues to €5,1 bn, €211 mn less than in Jan-Oct 2014.
Due to a decline of €47 mn in grants the total change in overall revenues of the central government reached -€258 mn.
Central government spending
The Cystat data show a small increase in public spending mostly due to current transfers.
Total primary expenditure increased by 1.3% or €63 mn to €4.755 mn from €4.693 mn last year.
The largest increase of 8,6% or €92 mn was registered in current transfers reaching €1159 mn from €1067 mn.
On the contrary, the biggest decreases were evidenced in social security payments and wages and salaries as they declined by €41 mn and €22 mn respectively.
The costs of debt service remained constant at €405 mn.
As a result, the primary surplus – the surplus without the cost of debt service - of the central government reached €361 mn compared to €682 mn in the ten months of 2014 while the overall balance stood at -€44 mn compared to €277 mn.
General government
Despite the drop in revenues and increase in spending, the overall balance was improved by a surplus from local authorities and semi-public entities as well as from technical adjustments.
There was a surplus of €16 mn from local authorities and semi-public entities compared to a deficit of €17 in 2014.
Cash flow adjustments as per the EU methodology reached €94 mn compared to €28 mn in the same period of the previous year. The figures given do not explain the adjustments made.
The resulting balance of the general government reached €65 mn compared to €287 mn in 2014.
According to the objectives of the updated memorandum, the primary surplus should reach €334 mn or 1,9% of GDP in 2015 while the general balance is to be -€156 mn or -0,9% of GDP.
The return of Cyprus to a recovery path is not accompanied by a respective improvement of public finances, as there is a deterioration of revenues and a small increase in expenditures.
According to new data by Cystat, the fiscal surplus for the general government in the first ten months of 2015 amounted to €65 mn against a surplus of €287 mn last year.
In the first nine months of 2015 fiscal surplus amounted to €101 mn.
Central government revenues
The total public revenues fell by 4,8% or €258 mn in the first ten months of the year to €5.116 mn from €5.374 mn in the same period of 2014. The decline is partly attributable to the lower dividend granted by the Central Bank this year, as it stood at €133 mn from €189 mn last year.
Direct taxes fell by €117 mn while indirect taxes increased by €12 mn mainly due to higher social security contributions which were up by €16 mn.As a result tax revenue was down by €88 mn.
Non-tax revenues decreased by €122 mn mainly due to the lower central bank dividend, bringing the current revenues to €5,1 bn, €211 mn less than in Jan-Oct 2014.
Due to a decline of €47 mn in grants the total change in overall revenues of the central government reached -€258 mn.
Central government spending
The Cystat data show a small increase in public spending mostly due to current transfers.
Total primary expenditure increased by 1.3% or €63 mn to €4.755 mn from €4.693 mn last year.
The largest increase of 8,6% or €92 mn was registered in current transfers reaching €1159 mn from €1067 mn.
On the contrary, the biggest decreases were evidenced in social security payments and wages and salaries as they declined by €41 mn and €22 mn respectively.
The costs of debt service remained constant at €405 mn.
As a result, the primary surplus – the surplus without the cost of debt service - of the central government reached €361 mn compared to €682 mn in the ten months of 2014 while the overall balance stood at -€44 mn compared to €277 mn.
General government
Despite the drop in revenues and increase in spending, the overall balance was improved by a surplus from local authorities and semi-public entities as well as from technical adjustments.
There was a surplus of €16 mn from local authorities and semi-public entities compared to a deficit of €17 in 2014.
Cash flow adjustments as per the EU methodology reached €94 mn compared to €28 mn in the same period of the previous year. The figures given do not explain the adjustments made.
The resulting balance of the general government reached €65 mn compared to €287 mn in 2014.
According to the objectives of the updated memorandum, the primary surplus should reach €334 mn or 1,9% of GDP in 2015 while the general balance is to be -€156 mn or -0,9% of GDP.
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