Spending cuts for appearances
For a second year the ‘social dividend’ will be funded at the cost of the Public Investments Program
State investments are being sacrificed on the altar of the government’s social profile: While the government is distributing 1.4 billion euros, the Public Investments Program (PIP) has frozen, according to the budget figures issued yesterday by the Finance Ministry for the January-October period.
The flash estimates published by the State General Accounting Office showed that PIP expenditure was reduced by 1.087 billion euros in the year to end-October, as instead of scheduled investments of 3.06 billion, the state only spent 1.97 billion euros.
The draft budget states that the target of 6.75 billion euros will be met by the end of the year, but the ministry had said the same thing last year when the PIP was abandoned so that a “social dividend” worth 615 million euros could be paid out. Last year’s PIP was reduced by 460 million (i.e. three-quarters of the social dividend).
The general trend of containing expenditure resulted in the primary budget surplus amounting to 5.355 billion euros in January-October, against a target of 5.239 billion.
Net revenues came to 40.6 billion euros, missing their target by 2.84 billion or 6.5 percent. The ministry says that the shortfall is due to increased rebates, which were up 1.96 billion euros on projections, and to the belated start of Single Property Tax (ENFIA) payments in September instead of August. Besides those two reasons cited, though, the shortfall came about mainly because of taxpayers’ inability to meet their obligations: Last month alone 410,000 taxpayers were added to the list of state debtors.
State budget expenditure for the January-October period amounted to 40.43 billion euros, 2.94 billion euros below the target. In October budget 720.18 1.1745 spending amounted to 4.07 billion euros, which was 622 million euros less than forecast. This year the state has spent 101 million euros less than planned on hospitals, 157 million less on the solidarity social income and 73 million euros less on main residence protection, among other cuts.
The draft bill outlining the handouts for low-income Greeks was submitted to Parliament yesterday with the aim of it being approved by Thursday.