ATHENS – Greece’s beleaguered coalition government built up its revenues the old-fashioned way: by not paying its bills for months.
The method worked to produce a primary budget surplus – not including interest on debt, the cost of running cities, towns and state enterprises, social security and some military expenditures – but it means vendors and suppliers aren’t getting their money.
The government also is trying to scrape together money to pay workers and pensioners this month, including trying to get all cities and towns to turn over all their spare cash, but some Mayors are balking.
Finance Ministry data showed that spending in the first four months of the year was 2 billion euros less than originally planned.
“The lower expenditure is mainly attributed to the restructuring of the cash planning based on the existing liquidity conditions,” the ministry admitted in a statement. It means Greece isn’t paying its bills, an accounting trick to show bigger balances.
The net revenues of the budget are marginally within target, largely thanks to the inclusion of 555 million euros from bank bailout fund HFSF and not the collection of taxes.
The Public Investment Program also helped the budget stay on course as its revenues were higher than anticipated and its expenditure below that forecast, Kathimerini said.
That created a primary surplus of 2.1 billion euros against a target of 287 million, although the figures are misleading in the long run given the way it was attained.
Spending came to 16.3 billion, while revenues lagged their target by 92 million euros, reaching 14.3 billion.
An estimated 135 million euros has so far been collected from the 100-installment payment program for debts to the state.