KINGSTOWN, St. Vincent – Prime Minister Dr. Ralph Gonsalves has told Parliament that the deficit for the first third of this year is lower compared to the same period of 2011.
But Opposition Leader Arnhim Eustace said the situation has resulted from the non-payment of some of the government’s bills.
A deficit refers to the amount by which something, especially a sum of money, is too small.
“Mr. Speaker, let me say, first of all, that the fiscal situation for the first four months of this year, compared to the first four months last year, … has improved. But I want to reduce the force of that statement by saying it is still a challenging situation and we are not out of the woods,” Gonsalves told Parliament Thursday in response to a question by Eustace.
He said that between January and April this year, total revenue and grants was EC$152.4 million compared to EC$144.7 million year-on-year, while current revenue was EC$148.3 million in 2012 and EC$142.6 million last year.
Total expenditure for the first four months of 2012 was EC$159.3 million, compared to EC$176 million during the same period last year, while recurrent expenditure was EC$157.6 million and EC$172.6 million, respectively.
The current balance registered a deficit of EC$9.26 million, an improvement over 2011, when there was a deficit of EC$29.9 million.
The overall balance was a deficit in 2012 was EC$6.98 million, compare to a deficit EC$31.27 million last year.
“So as I say, a little better than last year, or, you can use the formulation, improved somewhat, but still we have our challenges,” Gonsalves told lawmakers.
But Eustace said on radio on Monday that the deficit had fallen not because of an improvement in the nation’s economic circumstances.
“The deficit has fallen because you didn’t make certain payments that you should have made. If he (Gonsalves) had made those payments — like those that went to the private sector and so on — which ought to have been made, it would have been wider, not less,” he said.
“By not spending something, which you owe, that does not solve your deficit problem … because you still owe it and at some point in time you have to pay it. So let us not fool the public with that. And I think the Prime Minister himself recognises that,” Eustace said.