Catalonia reduces its deficit in the first 10 months of 2012 by 23% compared to last year

Barcelona (ACN).- At the end of October, the Catalan Government had a 1.17% deficit, representing a difference of €2.34 billion between revenue and spending, according to budget execution data released by the Catalan Finance Ministry. It is a significant reduction compared to last September, when the deficit reached 1.26% of Catalonia’s GDP. Furthermore, it also represents a 23% reduction compared to the first ten months of 2011, when there was a €3.05 billion deficit. The improvement is mostly due to an increase in revenue. By the end of 2012, the Catalan Government is obliged to honour a 1.5% deficit in order to meet the deficit targets imposed by the Spanish Government. The governments of the Autonomous Communities, including the Catalan one, are globally responsible for 36% of Spain’s public spending. They are in charge of managing the pillars of the Welfare State, such as public healthcare, education and social policies. Furthermore, in Catalonia’s case, the Catalan Government is also responsible for prisons and police, among other additional policies. The Spanish Government, responsible for around 50% of public spending, has decided it had to honour a 4.5% deficit in 2012, three times more than the Autonomous Communities. In total, the whole Spanish public sector has committed, in front of the European Union, to end 2012 with a 6.3% deficit.

The Catalan Government has improved the balance of its executed budget this October, ending the month with a 1.17% deficit. The difference between revenue and spending represented €2.343 billion, a 23% reduction compared to figures from October 2011. This means that the Catalan Government has been able to cut down the deficit by €710 million in the last 12 months.

The correction is mostly due to an increase in revenue. Until the end of October, the Catalan Government had obtained revenue of €18.724 billion. This figure is significantly higher than the revenue obtained in the first 10 months of 2011, despite the economic recession. Between January and October 2011, the Catalan Government obtained €18.169 billion in revenue. Therefore, in 2012, Catalonia’s Executive obtained €555 million more in revenue.

Regarding spending, the Catalan Ministry of Finance has also managed to improve results and reduce spending from one year to the next, although most of the spending is on healthcare, education, social policies and security. Between January and October 2011, overall spending represented €21.223 billion, while in the first 10 months of 2012 it represented €21.068 billion. The difference is thus €155 million between the two years.