Government spending up

This country’s current expenditure is rising, and Prime Minister Dr Ralph Gonsalves says it is a situation that must be watched closely, even though he recognizes that the increasing prices of several items worldwide is contributing significantly to this situation.{{more}}

Last Thursday, July 31, in Parliament, Dr Gonsalves, who is also Minister of Finance, presented figures representing the country’s fiscal position up to the end of June.

The recurrent expenditure jumped 20 per cent from $168.7 million for the comparative period last year to $203 million this year. This is part of the total expenditure which was $246.9 million, up from $212.18 million last year, or an over 16 per cent increase.

Personal emoluments, transfers and subsidies and money spent on goods and services are the key areas that contribute to the increase in the current expenditure.

With recent increases in salaries of members of the public service, personal emolument payments have gone up by 16 per cent over last year from $76.7 million to $88.8 million.

Transfers and subsidies moved up 33.9 per cent from $29.6 million to $ 39.6 million, while government spent $42.2 million on goods and services, compared to the $30 million last year over the same period, a huge 40 per cent increase.

Dr Gonsalves explained that government has been paying subsidies in several areas as they try to ease the burdens which are brought on by external situations on the poor. One such subsidy is that which is given to Mini Bus operators in an attempt to keep the bus fares down in the midst of rising gas prices.

However, Dr Gonsalves recently indicated that despite the subsidy, the mini bus operators may have to get the increase in fares that they have been battling him for over the last two years.

The current account balance stood at $13.4 million at the end of June this year, compared to the figure of $20 million over the same period last year.

Dr Gonsalves, however, said that the fiscal situation is doing better than was budgeted, with a 17.7 per cent variance.

On the revenue side of things, total revenue and grants over the period in review were $229.4 million, an increase of 15.8 per cent over last year, Dr Gonsalves reported.