Catalan deficit cut by 6.9% in November

Barcelona (ACN). - The Catalan Government plan to reduce its deficit appears to be working. Despite the reduction in public revenue due to the gloomy economic situation, the Catalan deficit was cut by 6.9% in November when compared to last year’s figures. New data published by the Department of Finance indicates that the deficit in November was €3.798 billion, which was €283 million less than in 2010 when the figure was €4.081 billion.

The Catalan deficit in November was 1.95% of GDP, €3.798 billion. The Government’s aim is to close this year with an overall deficit of 2.66%, according to sources in the Finance Department. However, the same sources admit that the decision by the Spanish government to delay the payment of €759 million, which was included in the Catalan Government budget, may affect the deficit reduction plan.

Since the beginning of 2011, the Government has reduced its spending by 4.9% when compared to one year ago. This means the executive has paid bills to the value of €23.909 billion, €1.249 billion less than during the same period in 2010. The main cutbacks have affected public and civil servants. In fact, up until November the workers payments have been reduced by 4.3% when compared to 2010. Public worker salaries totaled €4.437,6 billion, €199 million less than in November 2010 when they were €4.636,7 billion.

Every government department has reduced its spending. Education has suffered a cut of €299.7 million when compared to 2010, which represents 6,6% less. Health has also reduced its spending significantly to €8.621 billion. This is 1.6% less than in 2010. Finally, the Social Services Department budget has been cut by 4.7%. The deficit reduction has been achieved. However government funds have been cut significantly due to the bad economic situation. Revenue has dropped by €966 million, 4.6% less than in 2010.

The trend towards a decrease in earnings was already expected in October, when income fell by €964 million, a 5% reduction when compared to last year. In September, Government revenue was 2,98% less than in September 2010. Overall, government income in law documents and transfers has been reduced by 8.3% in the first 11 months of 2011. The main causes of this decline on income are the persistent construction crisis and the fall in building sales. Inheritance tax revenue dropped even further. The tax was almost completely eliminated at the beginning of the year. The government has received €376 million from this tax, almost €226 million less than in 2010, which represents a 37% reduction.