The Ministry of Finance and National Planning has released its latest publications on the Government of Tonga's Monthly Finance Report for the Month of August 2011.
In this report, it provides an overview of the Government's budget performance on a monthly basis, with the purpose of improving the transparency of the budget execution and promote good governance.
This August Report is the second report for the Financial Year 2011/2012.
According to the Report: some key budget highlights:
- - The global economy is entering a dangerous zone as double-dip recession is imminent. Thi global situation has amplified the fear of a negative impact on the government revenue generation.
- - The overall budget performance for the month of August 2011 generated a budget surplus of $12.8 million with an operating surplus of $12.0 million for the two months of July and August. This compares to a balance budget in August 2010. This $12.6 million budget surplus has improved the cash reserve account.
- - Revenue of $26.3 million was collected (including $12.8 million EU budget support), exceeding the target of $25.2 million. The good recurrent revenue performance can also be attributed to an increased volume of imports in commercial goods, fuel and tobacco. Revenue for the same period last year was $12.3million, collected mainly from trade consumption tax and exercise tax;
- - EU budget support of $12.8 million was received during the month. The full amount has already been distributed to specific activities in the in-year budget
- - Expenditure payments reached $13.7 million in August, marginally lower than the target of $14.5 million. Lower spending reflects delayed payment of subsidies and grants to non-government schools. Established staff is the major component of expenditures amounted to $6.8 million lower than in July due to one-off payments of Parliamentarians' relocation and constituency allowance and housing allowance for CEOs. For the purchase of goods and services, it recorded a $1.4 million lower than the outcome of previous month attributing to subsidy payment for street lights and payment of patients' medical referral. Overall expenditure for the same period of last financial year was $12.3 million.
- - Increasing unbudgeted requests for August of $3.0 million on top of $2.3 million carried forward from July continues to be a major budgetary concern.
- - Unbudgeted requests are expected to continue which is likely to result in a continued reduction of government available liquidity limiting resources for assigned activities envisaged in the Annual Management Plans (AMPs)
- - The looming global double-dip recession, however, will indeed negatively impact the revenue generation hence shrinking the availability liquidity
- - Fiscal risk remains a budgetary focus. More conservative revenue projections are likely to constrain spending choices of the government
For full text of the Report click here
Issued by the: Ministry of Information and Communications, Nuku'alofa, 2011. Source: Ministry of Finance and National Planning.