Budget deficit target too high for government

MANILA, Philippines – The Aquino administration may not meet even its revised budget deficit ceiling of P260 billion for the year, and incur a budget gap that is below the ceiling, as government spending has yet to significantly improve.

Budget Secretary Florencio Abad said it would be a “challenge” to meet the P260 billion, earlier revised downward by the interagency Development Budget Coordination Committee from the P300 billion it previously set.

However, Abad said that there is a huge amount of money that the government does not necessarily need to spend.

“There is a huge amount of money that is not being spent because you don’t need to spend them and because of good things we did in managing the funds of the government,” Abad said.

However, the Budget chief said next year’s spending would significantly improve given the projects to be implemented in the first six months of 2012. These include Public Private Partnership projects.

President Aquino also said that the government would make sure not to repeat the under-spending it experienced this year.

Abad said that with the early approval by Congress of the 2012 budget, projects slated for next year would be implemented early.

In October, the government incurred a budget deficit of P21.257 billion, wider than the P10.514 billion recorded in the same period last year, latest Finance data showed.

The October budget gap brought the January to October fiscal deficit of the government to P74.251 billion, significantly lower than the deficit of P270.302 billion incurred during the same period last year as government spending fell below the disbursement level a year ago.

Revenue collections in the first ten months of the year rose to P1.121 trillion, up by 12.87 percent from the P993.219 billion generated a year ago. On the other hand, total disbursements amounted to P1.195 trillion in the 10 months to October, which is 5 percent lower than the comparable disbursements in 2010.

In October alone, revenue collections reached P103.939 billion while actual disbursements during the month amounted to P125.196 billion, higher by 14.84 percent from the P109.017 billion spent in the same month last year. –Iris C. Gonzales (The Philippine Star)