Treasury posts Rs22bn primary surplus in Budget, first time in 63 years

Jan 08, 2018 (LBO) – Government has achieved 21.9 billion rupees surplus in the primary balance of the fiscal accounts during the first ten months of 2017, for the first time in 63 years.

Finance Ministry said in the post independent Sri Lankan history a surplus in the budget deficit was first recorded in 1954 and later in 1956. In the meantime the surplus in the current account was registered from 1950 to 1970 and later from 1973 to 1994.

“Since then up to now overall budget deficit, deficit in the current account and the deficit in the primary balance were in negative growth continuously,” Finance Ministry said.

During the first ten months of the year 2017, the surplus in the budget primary balance was 21.9 billion rupees. It was in negative by 37 billion rupees during the corresponding period of 2016.

“Treasury officials are in the opinion that the favourable situation in the primary balance is a sign of positive growth in the economic development and it would further enhance the capacity to manage the debt repayment efficiently.”

State revenue when compared with the first ten months of 2016 has increased by 10.4 percent to 1,473 billion in 2017. It was 1,333 billion during the same period in 2016. Tax revenue during the same period has increased by 14.2 percent to 1,470 billion in 2017.

State expenditure has increased by 9.5 percent from 1,881 billion to 2,060 billion while interest expenditure during the first ten months of 2017 is 609 billion apart from the domestic and foreign debt repayment of 856 billion.

Having an excess in the state revenue more than the whole state expenditure minus the interest payment is known as the surplus in primary balance.