BUSINESS

Primary surplus reached 2.5 bln euros in Q1

By Sotiris Nikas & Prokopis Hatzinikolaou

The general government primary budget surplus in the first quarter of the year amounted to 2.5 billion euros, according to data released on Wednesday by the Finance Ministry. That is three times the size of the primary surplus a year earlier, which had come to 770 million euros.

The figures compiled by the State General Accounting Office showed that this 1.73-billion-euro improvement is attributed to the social security system, as its organizations received 1.15 billion euros less from the state budget in the January-March period than in the same quarter of 2013. The funds covered a large part of this reduction by slashing the amount spent on pensions by 285 million euros and healthcare expenditure by 233 million euros.

The accounting office’s detailed data point to a central government budget deficit of 1 billion euros, against 2.5 billion in the first quarter of last year. Central government bodies showed a surplus of 496 million euros against a deficit of 108 million last year.

The surplus of local authorities shrank to 298 million euros this year from 417 million a year earlier, while the social security organizations’ surplus dropped to 812 million euros from 1.1 billion last year, owing to the reduction in budget funding and despite the reduction in spending on pensions and healthcare.

The general government budget showed a surplus of 529 million euros, with the primary surplus, which excludes interest payments, coming to 2.5 billion. The state debt amounted to 320.4 billion euros in the first quarter of the year, slightly less than that a year earlier (321.4 billion).

Meanwhile private sector debts to the state and vice versa are continuing to mount, highlighting the economy’s persistent cash flow problems.

The data published by the ministry showed that taxpayers and corporations failed to meet obligations amounting to 3.56 billion euros in the first quarter of 2014. At the same time the state’s dues to the private sector grew by 549 million euros, reaching a total of 5.19 billion euros.

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