Gov’t still underspending, overearning in September

The national government’s budget deficit in September barely narrowed, by 0.6 percent compared to the same month of 2021, to P179.8 billion from P180.9 billion as growth in revenues outpaced that of expenses.

Still, despite rising year-on-year, September numbers were the lowest over the past several months.

Also, the government is expected to catch up with more overspending in the remainder of the year and the debt stock could end up representing a bigger rather than smaller chunk of the domestic economy.

The Bureau of the Treasury said last month’s cash operations brought the January to September budget deficit to P1 trillion, shrinking by 11 percent from P1.14 trillion in the comparative nine months last year.

Revenues surged by 25 percent to P288.8 billion in September while nine-month receipts revved up by 19 percent to P2.7 trillion.

At the same time, September expenses jumped by 14 percent to P468.6 billion while nine-month bills grew by 9 percent to P3.7 trillion.

Michael Ricafort, chief economist at the Rizal Commercial Banking Corp., said the September deficit was the widest in three months or since P215.5 billion in June.

Ricafort also said revenues in September represented a decrease to a six-month low from P293.9 billion in March while expenses rose to a three-month high from P505.8 billion in June.

The government wants its budget deficit at P1.3 trillion for the full-year 2022 in order to bring down the debt-to-gross domestic product ratio below the 60 percent threshold for what is globally considered as “prudent.”

The country’s debts represented 63.5 percent of the domestic economy at the end of March. This has improved to 62.1 percent at the end of June. On a full-year basis, the ratio was 60.4 percent in 2021.

However, First Metro and University of Asia and the Pacific said in a report that spending in the remainder of this year will rev up as the government would catch up with the “unused deficit.”

—Ronnel W. Domingo