Philippines may have hiked spending but budget surplus still up

Malacañang may have redoubled efforts to catch up on its spending program, but it continues to report growth in its budget surplus, Budget Secretary Florencio B. Abad said Thursday.

In August, funds were in excess despite a year-on-year rise in expenditures because of a “steep increase” in revenue inflows, Abad said in a statement.

The Bureau of the Treasury earlier reported that Malacañang posted a budget surplus of P9.22 billion last month.

Abad said that government spending seemed to have finally turned a corner after the state disbursed P114.93 billion last month, rising by 7.9 percent from the P106.5 billion reported in the same month of 2010.

Last month’s figure represents “the first positive growth of monthly disbursements during the year,” Abad said.

Hopefully, this “reversal of the contraction in spending experienced during the previous months” will continue, he added.

“These indicate that our expenditure catch-up plans have started to work in the past two months. We continue to line up programs and projects that will keep up the acceleration of disbursements in the remaining months of the year, well into the first half of the coming year.”

Also, the budget chief said that government expenditures, excluding interest payments, actually grew by 13 percent to P94 billion as maintenance expenditures, subsidy contributions to GOCCs and tax subsidies surged.

On the other hand, interest payments continued to wane, dipping by 10.1 percent year on year to P20.9 billion in August.

Abad attributed the budget surplus in August to the increase in the collections of the Bureau of Internal Revenue and Bureau of Customs, as well as nontax collections.

“We’re now seeing the effects of the intensified filing of cases against potential tax cheats and smugglers, as well as the administrative measures employed to check leakages,” he said.

Abad said that as of August, the Department of Budget and Management released allotments amounting to P1.346 trillion, or 82 percent of the P1.645-trillion national budget for 2011.

Abad said this was better than the rate of spending seen in the same period last year, when 75.9 percent of allotments were released from the P1.541-trillion budget for 2010.