The government budget deficit in 2006 narrowed to NIS 6.1 billion, or 0.9 percent of gross domestic product - not including net credit - nearly a third of the planned deficit of NIS 17.2b., or 3% of GDP, on the back of strong increase in state tax revenue growth, privatization revenue and tight control of government spending, the Finance Ministry said Thursday.
In comparison, the deficit (exclusive of net credit extended) in 2005 was NIS 11b., or 1.9% of GDP, compared with a planned deficit of NIS 18.9b., or 3.2% of GDP, the Treasury noted in its annual report.
Total government revenues generated in 2006 was higher than the planned NIS 204.4b. and stood at NIS 216.6b., of which NIS 202.3b. came mainly from tax and other revenues. An additional NIS 4.7b. was generated from privatization processes including NIS 2.6b. from the privatization of the Ashdod refinery, NIS 1.6b. from the privatization of Israel Discount Bank and NIS 0.5b. from the privatization of Bank Leumi.
On the other hand, the annual financial report of the Government of Israel revealed that government actuary debt for current and future pension payments to state employees in 2006 rose by 9.5% to a record of NIS 367b., while the state budget stood only at NIS 285b. Furthermore, the report for the first time provided data regarding the National Insurance Institute, which ran into a deficit of NIS 100b.
The 2006 annual balance of payment report of the government was presented by Finance Minister Avraham Hirchson to the State Comptrollers' Office and the Chairman of the Knesset.