ECONOMY

Primary surplus posts dramatic fall in January

The general government primary budget surplus posted a remarkable drop in January compared to the same month last year, official figures confirmed on Wednesday, mainly due to the deficits reported by a number of social security funds, which lost more than 620 million eros in just one year.

The General Accounting Office data showed that the general government primary surplus amounted to just 419 million euros in January, against 1.8 billion a year earlier, putting extra pressure on the Finance Ministry: It highlights the problems in the budget’s execution and will be used as an argument by the country’s creditors for fresh demands for new austerity measures.

Against a primary surplus of 83 million euros in January 2014, social security funds posted a primary deficit of 539 million in the first month of this year. Pension funds’ revenues dropped from 3.1 billion euros to 2.7 billion, with the decline attributed to the 19.7 percent year-on-year drop in social security contribution collections – partly due to the reduction imposed on contributions since last July.

Pension funds also saw their outgoings grow from 2.6 billion euros in January 2014 to 2.78 billion a year on, because of a rise in healthcare spending from 197 million to 350 million euros.

There was a marginal decline in the state’s outstanding debts to suppliers and tax rebates from 3.76 billion euros in January last year to 3.75 billion this year, as the increase in debts to suppliers to 3.1 billion euros (mainly due to the rise in the debts of hospitals) was offset by the reduction in outstanding tax rebates to 648 million euros.

As for the state debt, it remained stable at 324.1 billion euros, the same as in December 2014, official figures showed.