Malta’s public finances slipped into deeper deficit territory in the first ten months of 2025, with the government registering a shortfall of €373.9 million, a sharp reversal from the €96.7 million surplus recorded during the same period last year. The figures, published by the National Statistics Office (NSO), show revenue growth continuing but at a much slower rate than expenditure, which has accelerated across several major categories.

Government recurrent revenue between January and October reached €6.38 billion, an increase of €257.9 million over 2024. The main contributors were higher social security contributions, which grew by €134.6 million; income tax receipts, which rose by €56.3 million; and licences, taxes and fines, which increased by €47.8 million. These gains were partly offset by a significant drop of €56.1 million in grant income and a further €11.6 million decrease in miscellaneous receipts. According to the NSO’s breakdown, social security contributions, income tax and VAT together made up the majority of government revenue.

Expenditure continued to grow at a much faster pace, rising to a total of €6.76 billion—an annual increase of €728.5 million. Recurrent spending accounted for most of this rise, with programmes and initiatives alone increasing by €290.9 million. Within this category, spending on social security benefits grew by €117.7 million, contributions to EU own resources climbed by €44.1 million, and funding for Church schools rose by €32.4 million. Contributions to government entities also increased substantially by €171.6 million, while personal emoluments expanded by €149.2 million and operational and maintenance expenditure rose by €55.7 million. Interest payments on public debt reached €242.7 million, marking an increase of €27.7 million over the previous year.

Capital expenditure also edged higher, rising by €33.4 million compared to 2024. This was driven mainly by progress on the second electricity interconnector, which accounted for €69.8 million; RePowerEU investments, totalling €18.7 million; and maritime facilities, which absorbed €7.8 million. These increases were partly offset by lower spending on road infrastructure projects and reduced uptake of electric vehicle schemes.

As a result of the widening deficit, central government debt continued to climb, reaching €11.19 billion by the end of October. This represents an increase of €924.3 million over the previous year and was primarily fuelled by additional Malta Government Stocks amounting to €672.8 million, €255.6 million in new Treasury Bills, and €77.7 million in foreign loans. The rise was slightly tempered by a decrease in outstanding 62+ Bonds and higher holdings of government assets within specific funds.