Estimates point to $529 million shortfall in coming year

Government is expected to rake in some $3.207 billion in the next financial year but will spend $3.736 billion, resulting in a $529 million deficit which it will have to fund.

That is according to the draft 2022/2023 Estimates laid in Parliament on Friday, which show that the projected revenue and expenditure are 7.2 per cent and 10.1 per cent higher, respectively, than the current financial year which will end on March 31.

Government is forecasting that it will spend $96.08 million more than originally estimated by the end of this financial year, while collecting $266.73 million less in revenue. In the upcoming fiscal year, beginning April 1, operating expenses are projected at $1.59 billion, statutory expenses at just over $917 million, and debt service $954.97 million.

Capital expenditure is projected to amount to $284.79 million. GDP is expected to reach $11.655 billion in the next financial year.

“When converted to international financial institutions’ basis, the fiscal deficit is projected at $386.8 million or 3.3 per cent of GDP,” stated the Estimates document which has been approved by Cabinet.

The Estimates approved for the 2021/2022 financial year were for $2.891 billion in revenue and $2.806 billion in current expenditure as well as $592 million for capital expenditure, which would leave a deficit of $506.5 million.

However, according to a review, Government actually only raked in $2.2 billion in revenue between April 2021 and January 2022.

Even with revenue for this month expected to be $153.2 million and $269.5 million for the month of March, total revenue for the current financial year would still fall short, reaching only $2.623 billion.

The review also showed that actual expenditure for the April 2021 to January 2022 period was $2.491 billion, while current expenditure for the months of February and March are predicted to reach $712.7 million.

It is further estimated that capital expenditure reached $230.2 million for the April 2021 to January 2022 period, while capital expenditure for the months of February and March 2022 are projected to be $60.5 million, for a total of $290.7 million for the current fiscal year.

Therefore, total expenditure should reach $3.494 billion for fiscal year 2021/2022.

This means that there should be an overall projected fiscal balance of -$870 million or -4.9 per cent of GDP, with the GDP estimated at some $10.11 billion.

“Current revenue collected to January 31, 2022 increased by 7.3 per cent from current revenue for the same period in fiscal year 2020-2021,” stated the document.
marlonmadden@barbadostoday.bb