A budget deficit has been reported as government spending increased in March after a budget surplus during the first two months of the year with income exceeding expenditure.
The budget deficit stood at MVR 165 million at the end of the first week of March and reached MVR 215 million by the end of the second week, according to the 'Weekly Fiscal Developments' report published by the Finance Ministry.
Total government spending stood at MVR 7.4 billion, the bulk of which was recurrent expenditure. The government's administrative and operational expenses accounted for most of the recurrent expenditure.
The biggest increase in March also came from the government's administrative and operational costs with MVR 700 million spent during the first two weeks of the month. The second highest expenditure during the period was on loan and interest payments.
State revenue stood at MVR 7.2 billion. The amount was lower than last year but tax revenue was higher this year. A total of MVR 6.1 billion has been collected as taxes so far this year, up MVR 348 million from last year.
The budget deficit is expected to widen in the coming weeks. The budget approved for the year projected a deficit of MVR 15 billion.
The deficit is low at present due to the government halting infrastructure development spending. The number of development projects will increase in the coming days based on the ability to secure financing, the government has said.
