THE HAGUE–The Committee for Financial Supervision CFT has concluded, based on the third Execution Report 2018 of the St. Maarten government, that up until September 2018 the realisation of the 2018 budget is better than projected. The deficit stands at NAF. 71.5 million, which is NAf. 65.3 million less than the budgeted deficit of NAf. 136.8 million.
According to the third Execution Report 2018, the realised revenues stood at NAf. 282.1 million, mostly due to higher tax revenues, while the expenditures amounted to NAf. 353.6 million, mostly due to a lower cost of personnel. The St. Maarten government collected more wage tax (+NAf. 20 million), turn-over tax (+NAf. 10.8 million) and profit tax (+NAf. 5.2 million) in the first three quarters of 2018 than projected.
On November 23, 2018, the Kingdom Council of Ministers approved a second payment of liquidity support for St. Maarten to the tune of the NAf. 32.9 million. On July 6, 2018, the Kingdom government had already approved liquidity support for an amount of NAf. 32.6 million. The CFT received the request for a third amount of liquidity support on November 16, 2018. The liquidity support tranches from the Netherlands are loans and as such have an effect on the country’s debt quota.
The CFT in its letter to St. Maarten Finance Minister Perry Geerlings of December 4, 2018, expressed concerns about the increase of the payment arrears of the St. Maarten government. The CFT urged St. Maarten not to let the backlog in payment increase any further and to make payment arrangements before January 1, 2019. In the third quarter, the payment arrears increased by NAf. 95 million to NAf. 169.9 million.
The backlog in payments to the Social Health Insurance SZV increased by NAf. 51.8 million. The payment arrears to the General Pension Fund APS increased by NAf. 23 million, and the debt to the telephone company TelEm has gone up with NAf. 20.2 million.
The CFT further expressed concerns about the lack of progress to improve the financial management. “Even though the 2016 annual account has been handled by the Council of Ministers and received by the CFT in November, there is still no approval by the Parliament of the 2013 and 2014 annual accounts.” The CFT concluded that there was also no progress on the submitting of the 2015 annual account to the Parliament.
Source: The Daily Herald https://www.thedailyherald.sx/islands/83381-st-maarten-s-2018-budget-deficit-lower-than-projected