Today’s article extends on the analysis presented in a previous article which was carried on July 7, 2019, titled “Contextualising 2018’s End Year Performance – Further Insights”, by this analyst. In today’s analysis, the author seeks to endeavour in a more comprehensive analysis of Government revenue and expenditure over the last eight-year period, aggregated and compared as two periods of four years each – for simplicity in the presentation. Space, however, precludes a detailed analysis in a single article and, thus, this article shall be continued in next week’s edition.
Source: Extrapolated from Bank of Guyana Annual Reports, Budget Speeches & End Year Outcome Reports by Ministry of Finance.
For the period 2015 –18, Government total revenue amounted to $751 billion which increased by $217.6 billion or 41 per cent from $533.4 billion in the corresponding period of 2011-14. This increase can be explained by increases in the level of taxation rather than increases in a more broad-based tax system. Total expenditure increased by $210 billion over the period 2015-2018 from $680 billion in the corresponding period of 2011-14, representing an increase of 31 per cent; while current expenditure increased by $228 billion for the period 2015-18 or 48.3 per cent from $472 billion in the period 2011-14.
On the other hand, allocation of expenditure for infrastructure and construction projects which include the rehabilitation, maintenance and construction of roads, bridges, stellings, education infrastructure, health and security infrastructure, Information and Communications (ICT) infrastructure, and hinterland roads and other infrastructure, increased by 49 per cent or $115 billion to $350 billion for the period 2015-18, relative to the corresponding period 2011-14.
Interestingly, however, while Government current or consumption expenditure for the period 2015-2018 increased by a whopping 48 per cent when compared to the previous four years period, capital expenditure for the period 2015-18 actually fell by 8.65 per cent or $18 billion relative to the period 2011-14.
Government expenditure is often divided into three main types: (1) current expenditure or government final consumption expenditure. This category of expenditure include goods and services for current use to directly satisfy individual or collective needs of the members of the community. (2) Capital expenditure of fixed capital expenditure (or government investment) include government spending on goods and services intended to create future benefits, such as infrastructure investment in transport (roads, rail, airports), health (water collection and distribution, sewage systems, information communications technology, and research spending). (3) Transfer payments – spending that does not involve transactions of goods and services, but instead represent transfers of money such as social security payments, pensions and unemployment benefits.
As mentioned earlier, this analysis will be continued in the forthcoming weeks in order to present a thorough analysis.
