Last year's budget: how much was spent?
In the News
| 15-03-2013
A recent report sheds some light on how the LD68.5bn ($55bn) budget, approved by the National Transitional Council (NTC) in March 2012, was used.
The Audit Bureau's 2012 report, which was issued last week, says that while budgeted spending came in at around LD13bn ($11bn) less than forecast, an additional LD10bn ($8bn) was spent from an emergency or extra-budgetary fund that included disbursements to families, debts from 2011, and additional funding for ministries and the armed forces.
The report also noted that the NTC budget should have included an additional LD3.4bn ($2.7bn) for servicing 'government debts', which effectively brought the actual budget for last year to a total of LD72bn ($58bn).
Total spending last year therefore appears to have been around LD69bn ($55bn), which is no small sum. It is around 20% higher than the final budget of the Gaddafi regime, which was set at LD57bn ($46bn) in January 2011 by the now-defunct General People's Committee for Planning and Finance but never actually followed through because of the conflict.
To put it in a regional context, Libyan state spent roughly the same as its Moroccan and Tunisian counterparts put together and, according to IMF figures, was equivalent to around 50% of its GDP in 2012. This was by far the highest in the region and outstripped all of the Gulf oil producers with the exception of Iraq, where the figure was around 76%. (Incidentally, though, France, the Netherlands, Greece, Italy, Finland, Belgium, Austria and Denmark all came in higher than Libya).
The Audit Bureau report said that more than half of the main budget was spent on salaries and subsidies, while a further LD3.6bn ($3bn) was paid out in grants to families, highlighting how state spending has been key to maintaining stability in the wake of the revolution.
In contrast, less than half of the development (or capital) expenditure budget was used. This is partly because the administrative structure to let and manage significant housing or infrastructure contracts has not been in place, and partly because many outstanding contracts from before 2011 are still being reviewed or renegotiated.
Although oil revenues recovered more quickly than expected last year - they accounted for around 95% of all state revenues in 2012 - the report noted that they were lower than forecast due to an over-optimistic assumption for average oil prices.
The 2013 budget, which has been provisionally set at LD66.5bn ($53bn) by the Ministry of Finance, is still under discussion at the General National Congress (GNC).
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