ECONOMY

Slower pace in 5-month spending

Revenues in the first five months of the year overshot the annual target while primary spending appeared to be finally coming under control, preliminary budgetary figures released by the Finance Ministry yesterday showed. Regular budget revenues rose 6.1 percent year-on-year to 15.4 billion euros in the January-to-May period against an annual target of 5.6 percent, after discounting last year’s one-off gain coming from the euro changeover. Primary spending increased 9.6 percent to 11.8 billion euros, surpassing a 6 percent annual goal. Regular budget spending rose 12.3 percent, a twofold increase from the 5.2 percent target. The figures showed a massive improvement from statistics in the first four months of the year when revenues crept up by just 1.3 percent while primary expenditure rocketed out of control, soaring 18.6 percent. The Finance Ministry said the sharp decline in the pace of primary spending confirms a gradual slowing of the sharp increases recorded in the early months. The ministry last week unveiled a draft bill setting out a new system of checks and control on public expenditure at all levels of government. Cost-benefit analysis will be implemented to ensure that public funds are used to the best effect. Reporting on Greek public finances in April, the European Commission warned that Greece’s higher-than-projected spending could slow its efforts to reduce the debt-to-GDP ratio, among the highest in the region. It called for greater efforts to rein in spending before the costs of an aging population kick in. A high wage bill continued to be the main burden, accounting for 47 percent of primary spending, the budgetary figures showed. Subsidies to pension funds made up 31 percent of the total. Spending under the Public Investment Program rose 43 percent against a targeted 25.3 percent as the State pushed forward with Olympic Games-related projects. Interest payments increased 3.9 percent, surpassing an annual goal of 2.9 percent.