Gov’t spending seen breaching P5T in 2022
Public expenditures for priority programs and projects will breach P5 trillion by the time President Duterte ends his term in 2022, in line with the government’s plan to widen the yearly budget deficit to 3.2 percent of gross domestic product (GDP).
The government had programmed to spend P3.774 trillion this year, P4.214 trillion next year, P4.701 trillion in 2021, and a record P5.239 trillion in 2022, Development Budget Coordination Committee (DBCC) documents showed.
For 2019 to 2022, the government wanted to ramp up spending, especially on infrastructure, such that the DBCC widened the annual budget-deficit cap to 3.2 percent of GDP from 3 percent previously.
The wider ceiling was equivalent to a nominal budget deficit of P624.4 billion for 2019, P677.6 billion for 2020, P747.7 billion for 2021, and P823.5 billion for 2022.
The programmed expenditures in the next four years will outpace the projected total tax and non-tax revenues of P3.149 trillion this year, P3.536 trillion next year, P3.954 trillion in 2021, and P4.416 trillion in 2022.
The government was also eyeing to raise at least P2 billion a year from the privatization of idle assets.
As of end-June, the budget deficit was a narrower P42.6 billion compared to the P193 billion posted in the same period last year due to underspending on public goods and services at the start of the year, no thanks to the delayed approval of the P3.7-trillion 2019 national budget.
President Duterte signed this year’s appropriations only on April 15 as the two houses of Congress squabbled over “pork” funds.
As a result of government underspending, first-quarter economic growth fell to a four-year low of 5.6 percent.
Department of Budget and Management (DBM) Officer-in-Charge Janet B. Abuel had said the government could still achieve the budget-deficit program for 2019 through its spending catch-up plan, under which major infrastructure agencies such as the departments of Public Works and Highways and Transportation would speed up the implementation of P803 billion worth of projects for the rest of the year.
For his part, Finance Secretary Carlos G. Dominguez III on Thursday expressed optimism there would no longer be any delay in the approval of the proposed P4.1-trillion 2020 budget.
“For next year, I believe the budget will be approved on time and that we will not experience the same delays. [Budget submission] will be within the required period. In fact, on Monday, the final budget will be presented to the Cabinet by the DBM. Once it’s approved by the Cabinet and the President then they [the DBM] will submit it” to Congress, Dominguez said.—BEN O. DE VERA
