BD1bn deficit: Committee urges MPs to reject 2024 final accounts

TDT | Manama

Email: mail@newsofbahrain.com

Parliament is set to debate a recommendation to reject the government’s Consolidated Final Account for the financial year ending December 31, 2024, after the fiscal deficit widened to BD1.026 billion and public debt rose to BD19.3bn.

The Financial and Economic Affairs Committee advised MPs not to approve the final accounts, the budget performance report or transfers made between ministries and government bodies. Its position followed a review of submissions by the Ministry of Finance and National Economy, including the minister’s responsibility letter and the National Audit Office opinion, which found the accounts fairly reflected state revenues and spending.

Rising Deficit and Debt Burden

Total revenue fell 5.3% to BD3.026bn, while expenditure rose 2.1% to BD4.052bn. The overall deficit increased 32.6% from BD773.9m in 2023 to BD1.026bn. A primary deficit of BD81m was recorded, reversing a BD69.2m primary surplus a year earlier.

Public debt increase from BD17.9bn t o BD19.3bn, pushing the debt-toGDP ratio to 109% from 103%.

Revenue Pressures and Spending

Overruns Oil and gas income remained the largest revenue source at 60.1%, down from 63.7% in 2023. Taxes and fees contributed 31.2%, while returns on state assets increased. Revenue from fines and other sources reached only 30.9% of projections.

Recurring expenditure accounted for 92.8% of total spending. Interest payments rose 12.1% to BD945.2m. The committee said recurring costs exceeded approved allocations by BD374.8m, with execution reaching 111.1%, contrary to Decree-Law No. 39 of 2002.

Project Execution Gaps

Capital spending varied widely. The Ministry of Social Development used about 12% of its allocation, while the Ministry of Justice, Islamic Affairs and Waqf and the Ministry of Youth Affairs each recorded around 23%. Some entities cited procurement delays, revised project scopes and technical reviews for slower implementation.

Mixed Support Trends and Economic Outlook

Assistance for pensioners rose 3.8%, and unemployment insurance contributions increased slightly. Support for low-income households and food subsidies declined. The committee also noted that debts owed by stateowned companies and public entities were not fully reflected in the accounts, despite government guarantees.

Economic growth slowed to 2.6% in 2024 from 3.9% in 2023, though the current account posted a surplus of BD858m. Members said restoring fiscal balance would require rebuilding a sustained primary surplus to curb borrowing and gradually reduce debt as a share of GDP.