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2018 fiscal deficit target unlikely to be met — DBM

Mary Grace Padin - The Philippine Star

MANILA, Philippines — The government may fail to meet its deficit ceiling for the year even as both revenues and spending are growing beyond their respective targets, according to the Department of Budget and Management (DBM).

Budget Secretary Benjamin Diokno said the government’s fiscal deficit for 2018 may fall behind the P523.7 billion target, which is equivalent to three percent of the gross domestic product.

“Most likely it will be below target – we cannot exceed the target – (but) higher than last year’s. Last year, it was only 2.2 percent of GDP,” Diokno said.

Despite this, Diokno said the government has a “sound fiscal program,” especially with revenues going above target.

He said the Bureau of Internal Revenue and Bureau of Customs have exhibited strong revenue performance, while dividends from government-owned and controlled corporations improved due to better compliance and stricter monitoring.

The budget chief said the DBM would also ensure that infrastructure spending for 2018 would hit the target of 6.3 percent of GDP.

“I will see to it that we will,” he said.

The national government incurred a fiscal deficit of P350.6 billion in 2017, representing 2.2 percent of the country’s GDP. This was also below the three percent target of the government last year.

As of September 2018, country’s cumulative deficit has already reached P378.2 billion, 78 percent wider than the P213.1 billion recorded in the same period in 2017. This accounts for 72 percent of the P523.7 billion full-year deficit target.

The widening of the country’s fiscal deficit happened as the growth in government spending outpaced the increase in revenue.

Revenues as of end-September improved by 17 percent to P2.11 trillion from last year’s level of P1.8 trillion. This was also four percent higher than the P2.03 trillion revenue target for the period.

The BIR accounted for the bulk of the revenues, with collections amounting to P1.44 trillion. This was 11 percent higher than last year’s level of P1.3 trillion, but two percent below the target of P1.47 trillion.

Revenues generated by the BOC as of end-September also rose by 34 percent to P434.6 billion from P323.8 billion a year ago. The agency’s revenue was likewise four percent above its P417.5 billion target.

Government disbursements from January to September amounted to P2.49 trillion, 24 percent higher than the P2.01 trillion registered in the same period last year.

BENJAMIN DIOKNO DEPARTMENT OF BUDGET AND MANAGEMENT
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