The national government reported a primary budget deficit of P9.4 billion for March after netting out interest payments, reversing a primary surplus of P6.1 billion posted in February.
Without netting out interest payments, the government would have incurred a much bigger deficit of P40.2 billion as expenditures far exceeded revenues during the month, based on data released by the Department of Finance (DOF) on Wednesday.
The March budget deficit also exceeded the corresponding year-earlier budget gap of P35.2 billion, by 14 percent or P5 billion.
Revenue collection in March rose 14 percent year-on-year to P129.3 billion, while disbursements increased 14 percent to P169.5 billion.
Interest payments totaled P30.8 billion, up 20 percent year-on-year, with the bulk accounted for by domestic payments, the DOF data shows.
The agency said that domestic payments jumped 31 percent year-on-year on account of a P4.3-billion interest on a bond that pays coupon every March 31, which had to be moved to April as the actual payment date fell on a Sunday, and the borrowing cost of Treasury bills has been significantly higher this year.
On a year-to-date basis, the fiscal gap for the three months to March stood at P84.1 billion, or 27 percent higher than the P66.5 billion posted in the first three months of the previous year.
The year-to-date primary budget balance stood at a surplus of P19 billion.
In a statement, Finance Secretary Cesar Purisima said the national government is on track to sustain its robust fiscal position. The Development Budget Coordination Committee (DBCC) is targeting to limit the year’s deficit to P266.2 billion, equivalent to 2 percent of the country’s gross domestic product.
“Growing revenue collections, most notably that of the Bureau of Customs, are just one of several wins we have garnered recently,” Purisima said.
The Finance secretary also reported that the Bureau of Customs collections grew 34.4 percent over the comparable period last year, the highest year-on-year collections growth rate registered since December 2010.
Budget and Management Secretary Florencio Abad , meanwhile, said: “The year-on-year improvements we’re so far making on government spending are particularly obvious in the deficit and disbursement levels for March.”
“Altogether, we expect more efficient spending in the coming months, so that agencies can implement their programs quickly and ensure that key services are promptly delivered to the public,” he added.
Rafael Supangco, Angping and Associates Securities Inc. head of research, said the P266.2-billion budget deficit target of the government is achievable despite the deficits incurred so far.
“I think government expenditure is frontloaded so we may see deficit going down in the months toward the end of the year,” he said.