Public expenses: austerity paid off

The Treasury secretary, Benja Razafimahaleo is pleased with the austerity policy’s efficiency applied by the government of transition and that permitted to suppress the budgetary imbalances. Once the state finances were made stable, the administration could work properly. 

The conjuncture notice underlines that » the prudent management of public finances and the treasury’s situation contributed to a moderation of the inflation: the yearly slip of the consumption price index stabilized around 10% during the last 3 months, or even 9.2% by the end of June. As for the exchange rate, this prudence policy contributed to contain the depreciation of the Ariary « . 

Because of the predictable internal and customs tax revenues drop during the 2009 accounting period, the BFM conducted public expenses restrictions. These restrictions have been applied through a rigorous expense regulation. Budgetary credits written down in the initial law of finances have been cut. The retained regulation rate is 34%, a budgetary credits reduction of 1/3. 

According to minister Benja Razafimahaleo, public expenses have been limited to the essential. Apart from wages, pensions and the repay of foreign debts, the sectors of health, the education and the interior security have been favoured. 

The BFM is pleased to have secured the expenses for wages and pensions. The so much feared delays in the deadlines during the crisis have been avoided.  « The wages paid until the end of June rise to 340 billions Ariary « . 

By end of June 2009, the other expenses have been amounted to 28.9% of the initial finance law concerning the administration expense and 14.8% concerning the investments. 

The suspension of help and financial support from the international community was not lethal to the country’s finances. The repays of foreign debt have been done in time in spite of the political crisis. Some 2.83 millions DTS in April, 0,93 millions DTS in May and 1,91 millions DTS in June 2009. 

The BFM commits to respect its engagements to the state’s good and service suppliers through the repays of the VAT (47.8 billions Ariary from April to June 2009). An envelope of 18.1 billions Ariary has been used from April to June. The TVAPP (6.6 billions Ariary between April and June 2009) and the in time settlements of fuel checks (CCAL)…