The Luxembourg Court of Auditors has found the budget deficit for 2016 to be more than €800m higher than the figured suggested in a report issued by the finance minister Pierre Gramegna (pictured)
Photo: Chambre des députés
Court of Auditors: 2016 deficit was much higher than government said
The opposition has accused the finance minister of using “creative methods” in his budget statement, based on the Court of Auditors’ report (Cour des comptes), which was published on Tuesday 23 October.
The year-end budgeting process checks whether the planned expenses and earnings have been properly planned, voted, allocated and spent.
Parliament had voted on a planned deficit of €438.24 million.
DP finance minister Pierre Gramegna argued that this was due to exceptional operations, such as paying back 3 loans, investments in the rail and road funds (Fonds du rail, Fonds des routes) and other investments. After substracting these investments, the annual deficit for 2016 was actually only €256.82 million. Gramegna argued on 11 October in his budget speech that the results were better than all forecasts, not because revenues rose unexpectedly but “because we had expenses under control.”
The auditors reported that tax revenue was 2.69%, or €350 million, more than expected.
Debt levels are expected to rise by €3 billion over the period 2017 to 2021. In 2016, central administration debt levels were at 20% of GDP, or €10.85 billion.
For the period 2017-2021, this debt will grow in absolute terms to reach €15.84 billion in 2021.
“The government has, it has to be said clearly, submitted to us a tricked end of year statement of 2016. We have received the real figures from the court of auditors and the deficit stands at €1.3 billion, which is awful if one considers our record growth levels in Luxembourg.”