Higher government spending bloats deficit in November

MANILA, Philippines — The country’s budget deficit rose by more than 24 percent to P1.33 trillion as of November as the government ramped up its spending on infrastructure delivery and pandemic response to boost economic recovery.

The Bureau of the Treasury yesterday said the annual deficit spiked from P1.07 trillion a year ago.

Revenues raised by collecting agencies went up by roughly six percent to P2.77 trillion while government spending jumped by over 11 percent to P4.11 trillion.

For November alone, the fiscal balance was flat at P128.7 billion from P128.28 billion a year earlier, as both revenues and expenditures posted double-digit growth.

Revenues collected by the government expanded by 16 percent to P284.01 billion, driven by the recovering states of both taxpayers and traders.

Collections by the Bureau of Internal Revenue rose by nearly 10 percent to P210.75 billion.

Income generated by the Bureau of Customs ballooned by almost a third to P57.92 billion from P43.71 billion.

On the other hand, non-tax revenues swelled by 48 percent to P13.72 billion in November from P9.23 billion.

During the month, state spending grew by 10 percent to P412.72 billion amid the widening issuances for agencies working on infrastructure, public health and social protection.

According to the Treasury, primary spending increased by eight percent to P381.49 billion, while interest payments also spiraled by 56 percent to P31.22 billion.

As a share of revenues, interest payments jumped to 14.49 percent from January to November compared to 13.57 percent the previous year.

On the other hand, interest payments as a ratio of spending widened to 9.79 percent from 9.63 percent.

The government plans to grow its revenues to over P4 trillion by 2024 as part of efforts to bring down the country’s deficit in the next three years.

For next year, the country expects P3.3 trillion in revenues from the projected P3 trillion in 2021.

State expenditures are also seen to rise to P4.95 trillion from P4.63 trillion, as the government will be busy improving the election system and upgrading health facilities.

For this year, the government expects to sustain a budget deficit of P1.61 trillion, or 8.2 percent of the economy, with the plan of trimming it to 7.7 percent in 2022, 6.1 percent in 2023 and 5.1 percent in 2024.