Gov’t budget deficit narrowed by 59.2% in Aug

The country’s budget deficit narrowed by 59.24 percent to P54.2 billion in August from P133 billion in the same month last year amid a modest decline in state spending, the Bureau of the Treasury reported on Wednesday.

Data showed that total revenues in August increased by 24.40 percent to P386.3 billion, while state expenditures declined by 0.68 percent to P440.5 billion.

A budget deficit happens when the state’s expenses exceed its revenue.

For the first eight months, the budget deficit also went down by 4.86 percent to P697 billion from the P732.5 billion budget gap last year.

“This can be one of the benefits of the fiscal consolidation program of the government, streamlining expenditures vis-a-vis revenues generated,” John Paolo Rivera, senior research fellow at Philippine Institute of Development Studies, told the Inquirer.

Meanwhile, revenues from the Bureau of Internal Revenue (BIR), which historically accounts for 80 percent of state revenues, rose by 11.51 percent to P238.1 billion in August.

This brought its year-to-date collection to P1.92 trillion, up by 12.55 percent from last year. The BIR aims to collect P3.05 trillion for the full year.

The Bureau of Customs (BOC) collected P78.5 billion in August, up by 4.69 percent from P75. billion seen a year ago.

Since the start of the year, BOC’s collections grew by 5.66 percent to P614.4 billion.

Meanwhile, collection by the treasury department more than doubled to P16.5 billion from the P6.3 billion recorded last year.

“The increase was primarily driven by Power Sector Assets and Liabilities Management’s P10-billion settlement of guarantee fee arrears, alongside increased Philippine Amusement and Gaming Corporation (Pagcor) income,” the BTr said.

BTr’s income since the start of the year reached P200.3 billion, up by 33.46 percent, largely due to higher dividend remittance, interest on advances from state-owned corporations, guarantee fee collections, and the national government’s share in the income of Pagcor.

Collections from other offices—other nontax items, including privatization proceeds and fees and charges—surged to P49.6 billion for the month, nearly four times the P12.6 billion a year ago.

Year to date, the total amounted to P234.6 billion, higher by 89.16percent.

In terms of state spending, the modecline of 0.68 percent or P3 billion in government expenditure was attributed to the lower total subsidy releases to government corporations and the outstanding checks recorded in various departments, such as the Department of Public Works and Highways, Department of Social Welfare and Development, and the Department of Health, during the period.

Outstanding checks rare payments made by line departments for the delivery of goods or services but are not yet presented for encashment at the banks by the concerned contractors or payees

Primary spending—referring to total expenditures minus interest payments— fell by 3.27 percent to P387.8 billion in August. Year to date, primary expenditure reached P3.18 trillion, higher than P2.93 trillion last year.