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By Arnold S. Tenorio Business
Editor
FOLLOWING its record budget
surplus last month, the Philippines will end this year with a fiscal
deficit that is below ceiling, according to Malacañang.
President Gloria Arroyo said the
government is looking at a funding gap of P50 billion this year,
lower than the P63-billion revenue shortfall programmed for the
period.
Earlier, the Department of
Finance said the record surplus of P54.1 billion last month allowed
the government to post a P12.6-billion surplus in the first 11
months of the year.
The Finance department raised the
possibility of achieving a balanced budget earlier than next
year’s schedule, but Mrs. Arroyo said her administration would opt
to spend the revenues it generated this year on social services and
other projects.
“The market is happy with a
P50-billion deficit anyway, so why not spend the [extra] money?”
she told The Manila Times on Thursday night during a Christmas party
she hosted for members of the Philippine newspaper industry.
Among the items that would enjoy
funding include sleeping quarters for the military, for which
President Arroyo ordered the release of P900 million.
The record surplus last month was
largely credited to the government’s huge windfall from the sale
of state assets this year. Had it not been for these divestments,
the government would have ended November with a deficit of P35
billion.
It managed to raise about P90
billion from its privatization program, including crown jewel
Philippine National Oil Co.-Energy Development Corp. (PNOC-EDC), the
country’s largest, and the world’s second largest geothermal
energy producer.
Proceeds from these assets sale
helped offset collection shortfalls of the Bureaus of Internal
Revenue (BIR) and of Customs.
Any windfall from asset sales to
prop up its fiscal position next year, however, is in doubt, as
pundits admit the government may not have a boundless well of
properties attractive enough to fetch high valuations.
True enough, the Finance
department said privatization proceeds next year would fall to about
P30 billion, or a third of this year’s take.
Faced with the prospect of
dwindling proceeds form assets sale, Mrs. Arroyo said the government
would have to implement the Attrition Law to whip the BIR and
Customs into meeting collection targets.
“That’s why we have the
Attrition Law,” she said. Passed last year, the government has yet
to implement the law, which penalizes BIR and Customs personnel for
failure to hit revenue goals, and rewards them for meeting targets.
Citing civil service rules, Mrs.
Arroyo said while no BIR or Customs personnel would be sacked for
failing to attain collection goals, the law still allows government
to transfer under performing personnel.
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