THE Philippine national government’s budget position fell back to a deficit in February after just a month of a mild recovery from a huge shortfall in December, with revenue down sharply, data from the Bureau of Treasury (BTr) showed on Thursday.
The budget swung to a deficit of P23.7 billion in February from a surplus of P2.2 billion in January.
Government revenue in February dropped 25 percent to P151.83 billion from P200.31 billion in January.
Collections by the Bureau of Internal Revenue (BIR) slid 28 percent to P105.86 billion from P147.39 billion, while Bureau of Customs collections fell 14 percent from P35.94 billion.
Government spending in February declined 11 percent from P198.09 billion in January.
In a breakdown, interest payments slid 42 percent to P24.23 billion from January.
Only 14 percent of February expenditures went into interest payments, the Treasury said.
Allotment to local governments eased by 0.12 percent to P40.73 billion from January.
Other expenditures rose to P101.36 billion, while tax expenditures and subsidy rose to P69 billion and P9.99 billion, respectively, from January.
Compared with a year earlier, however, the budget deficit in February narrowed 44 percent from P34.6 billion, with revenue generation outpacing spending.
The government has set a cap on its budget deficit for the whole of 2017 at 3 percent of the country’s gross domestic product (GDP). The Treasury does not report such figure for its monthly data.
Revenue for the month rose 9 percent year-on-year to P151.8 billion, while spending increased only 1 percent to P175.6 billion. This brought year-to-date collections to P66.8 billion, up 15 percent over the 2016 level.
The BoC also maintained double digit year-on-year growth at 14 percent as it took in P30.9 billion for the month.
Income from the BTr contracted by 8 percent from last year for a total of P5.3 billion, traced to lower income from bond sinking fund/securities stabilization funds investments given the diminished asset base and lower dividends on share holdings of the national government.
The P7.7 billion non-tax revenue from other offices also stood lower than last year’s total, exhibiting a year-on-year contraction of 17 percent for the month.
The year-on-year increase in interest payment for the month “is due to coupon payments and other charges relating to liability management transactions in 2016 and the early part of 2017,” the Treasury said.
Net of interest payments, the budget yielded a P500 million primary surplus in February, reversing the P13.3 billion deficit posted a year earlier, it added.
For the first two months of the year, the cumulative shortfall amounted to P21.5 billion, 44 percent narrower than the P38.1 billion during the corresponding two-month period a year ago.
The bureau said January to February revenues grew 10 percent year-on-year “behind reforms set in place among revenue collecting agencies as well as the pickup in economic activity for the period.”
Year-to-date expenditures registered slight growth of 4 percent to P373.7 billion.
In terms of interest payments in the year to date, IP registered flat growth and stayed at P66.6 billion in the two months to February.
January to February primary budget posted a surplus of P45.1 billion, 57 percent higher than the P28.8 billion a year earlier.