State revenues were 20% below target last month, according to the Finance Ministry’s latest data, forcing it to revise its plans on the side of caution.
Senior ministry sources say it will implement only “slightly more measures” for the support of workers and enterprises, as the most likely scenario now points to a delay in the country’s emergence from the support framework beyond April.
The fiscal margin for further market support is limited. As Minister Christos Staikouras privately says, the government will continue to assist the market, but will not be able to cover all the additional needs that emerge.
The ministry is now anxiously counting the days and the weeks during which it can continue paying for furloughs, rents and all the measures used to date for the economy’s protection shield. Asked how long the budget will be able to stand the pressure of a new lockdown, ministry officials put it at two weeks, but probably not as much as three months.
Alternate Finance Minister Thodoros Skylakakis told Thema FM radio on Thursday that he would rather not answer the question of how long the available resources can last if the economy continues in pandemic mode until the summer, with tourism at great risk. What he did say was that “the economic situation is uncertain and we have to make ends meet, just like during a war.” He also made it clear that resources should be used in a more targeted fashion now.
The lockdown bill speaks for itself: Ministry calculations put the cost of the November lockdown at 3 billion euros per month for the economy. Last spring’s stricter lockdown set the economy back €4 billion a month. The additional cost of the click-and-collect and click-inside systems reintroduced last week comes to €500 million per month. A major share of that cost is borne by the state, burdening its budget.
The only positive aspect is that this is a problem shared by all countries, which means there will be no pressure for now to contain the budget deficit.