CLARK FREEPORT—As the jump in government spending outpaced the increase in revenues it collected during the first 10 months, the budget deficit widened by 87 percent to P438.1 billion.
During the Sulong Pilipinas 2018-Philippine Development Forum, Budget Secretary Benjamin E. Diokno and Finance Secretary Carlos G. Dominguez III both said that the robust expenditures on public goods and services were proof that the Duterte administration had already addressed the chronic problem of underspending.
The latest Bureau of the Treasury data released Monday showed that the end-October fiscal deficit increased from P234.9 billion in the same 10-month period last year.
In a statement, the Treasury noted that the deficit as of October already accounted for 84 percent of the P523.7 billion programmed for 2018.
Expenditures at end-October climbed 25 percent to P2.796 trillion from P2.241 trillion a year ago.
Net of interest payments, primary disbursements from January to October grew 27 percent to P2.501 trillion from last year’s P1.972 trillion.
Tax and non-tax revenues in the first 10 months increased 18 percent to P2.358 trillion from a year ago’s P2.007 trillion.
The tax take of the two biggest revenue agencies—the bureaus of Internal Revenue (BIR) and Customs (BOC), rose 12 percent year-on-year to P1.609 trillion and 34 percent to P490.6 billion, respectively, at end-October.
“In the bad old days of underspending, critics faulted the government for moving too slowly in getting the projects done. Now that we are moving ahead of our spending schedule, we are being faulted for enlarging the budget deficit, which incidentally was our target, which incidentally was what the business community asked us,” Dominguez said.
The Duterte administration had set a budget deficit cap equivalent to 3 percent of gross domestic product this year and a slightly wider 3.2 percent of GDP next year as it rolls out its ambitious “Build, Build, Build” infrastructure program.
For his part, Diokno said in a separate speech that the higher actual government spending was “clear proof that the ‘Build, Build, Build’ program is firing on all cylinders.”