The national government missed its budget deficit target last year as lower-than-targeted expenditures offset a surge in revenues, data showed on Tuesday.
The Bureau of the Treasury reported that the government incurred a 2017 budget shortfall of P350.6 billion, well below the P482.1-billion goal and also lower than the 2016 result of P353.4 billion.
It was equivalent to 2.2 percent of gross domestic product, under the 3-percent ceiling set for the year.
Full-year collections reached P2.473 trillion, the Treasury bureau said, breaching the P2.426-trillion program by 2 percent and up 13 percent for the year — the highest annual growth since 2013.
Expenditures, meanwhile, grew by 11 percent to P2.823 trillion from 2016 but missed the target by 3 percent.
The government ran a P107.1-billion deficit in December alone, the bureau reported.
Year-on-year revenue growth “reached its highest level for the year at 35 percent in December to reach P223.1 billion” while disbursements, at P330.2 billion, were also up, 16 percent year-on-year.
The government, Finance Secretary Carlos Dominguez 3rd claimed following the release of the 2017 results, will do better this year in terms of spending.
“You know it’s not like a sports car when you step on the gasoline it goes right away. This one takes a little time … we are moving in the right direction, I think,” he told reporters.
Analysts, meanwhile, offered contrasting outlooks.
University of Asia and the Pacific economist Victor Abola said public spending could improve this year but still fall short of projections.
“This is not only because of absorptive capacity of the national government/bureaucracy, but also delays in payment releases and COA (Commission on Audit) requirements,” he told The Manila Times.
Land Bank of the Philippines economist Guian Angelo Dumalagan said the deficit could widen further as the government’s ambitious infrastructure program was expected to gain more traction.
“In my opinion, government spending on infrastructure could overshadow the rise in collections as a result of the Train (Tax Reform for Acceleration and Inclusion) law,” he added.
“While a budget deficit means more debt burden for future generations, I believe that this rise in debt would be more than compensated by an increase in economic activity and income.”