Gov’t trims budget deficit; Q1 borrowings to widen
Slower government expenditures narrowed the Marcos administration’s budget deficit by almost a third in November, according to the Bureau of the Treasury (BTr).
The fiscal shortfall declined by 26 percent year-on-year to P157.6 billion last month, a reversal from the budget surplus recorded in October.
In November, the government spent P498.3 billion, down by 9.6 percent from P551.3 billion in the same month last year.
The 11-month fiscal deficit now stands at P1.26 trillion, still within the full-year target of P1.56 trillion, or 80.92 percent of the programmed amount.
However, the January to November deficit told a different story, widening 7.38 percent from P1.18 trillion a year earlier, underpinned by higher government spending that outpaced revenue collections.
Economist Jonathan Ravelas, senior adviser at Reyes Tacandong & Co., said, “November reflected catch-up disbursements for infrastructure and social programs as agencies rush to meet year-end targets.”
Ravelas added that the government should maintain stronger revenue mobilization and disciplined spending.
“The 11-month deficit is still within the government’s programmed ceiling, but it signals fiscal pressure ahead, especially if revenues don’t keep pace with spending,” he said.
Total government revenues for the January to November period reached P4.15 trillion, up by 1.09 percent from a year earlier. The growth was largely driven by higher tax collections, which offset a sharp contraction in nontax sources.
The Bureau of Internal Revenue contributed P2.91 trillion, 8.92 percent up from last year, while the Bureau of Customs collections inched up 1.12 percent to P859.5 billion.
Meanwhile, nontax revenues fell 36.85 percent to P350.6 billion in the absence of one-off windfall that had boosted collections in 2024.
Government expenditures rose modestly by 2.49 percent to P5.41 trillion, accounting for roughly 89 percent of the P6.08 trillion full-year program.
Reversing last month’s trend, the primary deficit eased by 1.77 percent to P463.2 billion, as ongoing investigations into anomalous flood control projects continued to delay implementation, temporarily restraining spending.
Q1 borrowings to double
The Marcos administration plans to nearly double domestic borrowings from the previous quarter, with P824 billion on the table for the first quarter of 2026.
BTr documents showed that the weekly debt offerings from January to March are 88.5 percent higher than the previous quarter’s P437 billion.
Of the total, the BTr is looking to sell short-term Treasury bills worth P108 billion each month, totaling P324 billion. Twelve auctions are slated for the quarter.
Meanwhile, up to P160 billion will be raised from the issuance of Treasury bonds (T-bonds) in January, up to P200 billion in February, and up to P140 billion in March, bringing the total T-bond issuance to P500 billion.
