via The National

TOTAL government expenditure in 2011 was K9,388.6 million – K1,296 million above the 2010 levels, Treasurer Don Polye has said.
It included additional support for basic government services such as education, health and infrastructure and K435.1 million more for public sector wages.
He said although government expenditure last year was higher than in 2010, it was lower than the forecast revised budget estimates.
Polye said this was because of a considerable reduction in expected donor project grants of K481.1 million.


“This reduction in donor grants is mainly a result of the appreciation of the kina against the Australian dollar,”  he said.


“It was also driven by a lack of timely data on an estimated K150 million in non-AusAID donor grants.”


Total revenue last year was K8,254.5 million, made up of K7,904.2 million in tax revenue and K350.3 million in non-tax revenue. This figure is almost identical to the 2011 revised budget estimate.
Total revenue grew by K1,384.7 million – or 20.2% – from 2010 to 2011.
This was as a result of strong economic growth leading to increased collection of tax on personal income and on mining profits as well as international trade.
He said the 2011 final budget outcome had recorded a deficit of K63.7 million, smaller than forecast.


“This represents an improvement of K24.3 million in comparison to the K88 million deficit forecast at the time of the revised 2011 budget.”


Polye said while the smaller deficit was not of concern, it emphasized the need to ensure spending remained at responsible levels. The final budget outcome sets out the final outcome and provides details of revenue and grants, expenditure and net lending and the financing requirements of the government.
It must be released on March 31 each year as required under the Fiscal Responsibility Act 2006.