The Tribune

By SANCHESKA BROWN

Tribune Staff Reporter

sbrown@tribunemedia.net

THE COUNTRY’S recurrent expenditure is actually more than $150 million below what was forecast in the mid-year budget, Minister of State for Finance Micheal Halktis said yesterday.

Making his budget contribution in the House of Assembly, Mr Halkitis said the $162 million in savings is a result of the government “eliminating unnecessary spending and streamlining what could be streamlined.”

Mr Halkitis said the largest reductions were reported in the Department of Public Service – $29.8 million; the Ministry of Tourism – $19.8 million; the Ministry of Finance – $19.4 million; and the Public Hospitals Authority – $17.5 million.

Despite making cuts across the board, he said several areas of government were subjected to little or no reduction in expenditure.

Those areas include the Royal Bahamas Police Force, the Ministry of National Security, the Prisons Department, the College of the Bahamas, the Bahamas Technical and Vocational Institute, the Department of Social Services, the Ministry of Youth Sports and Culture the Department of Labour and the Ministry of Works.

Mr Halitkis said capital expenditure is also below what was previously budgeted and is now $350 million, down $50 million from the last budget forecast and $13 million lower than the mid-year estimate.

However, due to the country’s weak economy Mr Halitkis said recurrent revenue is 11 per cent below the forecast.

“As one might with a weaker economy, the main revenue shortfalls are occurring in the areas of import duties and excise taxes, down by $49 million and $112 million respectively, from the forecast. Likewise, stamp taxes on real property transactions are down by $20 million, while business license taxes are lower than budgeted by some $15 million,” he said.

“On the plus side, air departure tax is $10 million higher than was projected. Despite the revenue weakness, our discipline on the expenditure has paid dividends in the GFS deficit in 2012/13, now projected at $508 million down from the $550 million budget estimate. While this is a stellar achievement in and of itself, it marks a stark departure from the experience of our predecessors, who invariably and miserably overshot their deficit targets year in and year out.”