Only one in every three pesetas of the government budget goes on investments to improve conditions on the islands, all the rest is eaten up by running costs. Out of a total of 158'148 million pesetas, only 51'281 million pesetas will go on direct investment, while the balance will go to paying running costs, according to this year's budgets. This is a far cry from 1996 and 1997, when 48 per cent of the budget went on investments. Historically, the Balearics have always spent about half the budget on investments, but the situation changed radically in 1998, when only 42'764 million pesetas went on investments compared to 77'959 million pesetas on current costs. The reason lies in the fact that it was in that year the central government transferred responsibility for education to the Balearics. This meant a big increase in staffing levels and a corresponding increase in the wage bill for the new functionaries who until that year had had their wages paid by the central ministry of education. Even so, the proportion between running costs and investments was 61.3 per cent compared to 38.7 per cent. Since then, however, the amount spent on investments has been going down steadily, and this year is only 32.4 per cent of the budget.

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