Payment halt cuts spending by 2 bln euros

The government has completely stopped payments to suppliers and taxpayers in a bid to prop up the state’s lagging revenues and cover other obligations in the absence of funding from its creditors. Finance Ministry data showed on Wednesday that spending in the first four months of the year was 2 billion euros less than originally planned.

“The lower expenditure is mainly attributed to the restructuring of the cash planning based on the existing liquidity conditions,” the ministry admitted in a statement.

The net revenues of the budget are marginally within target, largely thanks to the inclusion of 555 million euros from bank bailout fund HFSF and not the collection of taxes. The Public Investment Program also helped the budget stay on course as its revenues were higher than anticipated and its expenditure below that forecast.

Given the above, the primary budget surplus of the first four months amounted to 2.1 billion euros, against a target of just 287 million euros. Spending came to 16.3 billion, while revenues lagged their target by 92 million euros, reaching 14.3 billion.

An estimated 135 million euros has so far been collected from the 100-installment payment program for debts to the state.

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