Government budget gap reaches P237.5 billion in first 9 months

By LEE C. CHIPONGIAN
October 19, 2009, 6:01pm


The government incurred a budget deficit of P237.5 billion in the first nine months of the year on higher spending despite lower-than-target revenue collections, Finance Secretary Margarito B. Teves said Monday.

Teves said for September, the budget gap amounted to P27.5 billion.

“We are really facing tough times,” he said yesterday. “Our revenue collection efforts are seriously hampered by the slowdown in economic activities and tax breaks that were granted largely through legislation.”

The actual deficit was P10.9 billion higher than the programmed ceiling of P217.6 billion for the period.

Teves added – “we may be facing the worst of times but we are not giving up.”

In the first nine months, revenues amounted to P839.8 billion, lower than program by P74.4 billion. The DoF chief said collections were “severely affected” by the economic slowdown and revenue-eroding legislative measures.

Of the total revenues, the Bureau of Internal Revenue (BIR) collected P557 billion, short by P39.2 billion against its target for the period. The Bureau of Customs (BoC), on the other hand, incurred a P36 billion shortfall with total collection amounting to P165.4 billion for the period.

The Bureau of Treasury (BTr), on the other hand posted an income of P52.2 billion, which was P4.5 billion more than expected.

Revenues from "other offices" which included privatization proceeds, totaled P65.1 billion, also below the program by P3.6 billion.

Teves is still hoping to generate P31 billion from the sale of state assets this year such as the negotiated sale of Food Terminal Inc. properties. "We remain hopeful that we will be able to dispose of government assets before the end of the year that could help us generate additional revenues for our rehabilitation and reconstruction efforts."

As of September, total expenditures amounted to P1.07 trillion, lower than program by P54.4 billion. This was due partly to interest savings of P21.1 billion arising from lower borrowing cost. Net of interest expense, expenditures grew by 20.5 percent year-on-year to reflect increased spending for projects to support economic growth.

For the month of September, the revenues collected totaled P100.7 billion, 12.3 percent compared to same period in 2008. The BIR collection slightly improved to P56.2 billion while the BoC posted a 29.1 percent decline in revenues to P18.3 billion. The BTr income was higher at P6 billion.

As for expenditures, this amounted to P128.2 billion, higher by 15.2 percent year-on-year. Net of interest payments, expenditures grew by 17.4 percent to P96.4 billion.

Teves said they would continue to spend to encourage growth. The funding for relief packages in the wake of the typhoons will also be addressed. "We need to spend for the urgent needs of our people, especially for the relief and rehabilitation of calamity-stricken provinces. Millions of crops were damaged and a number of bridges were destroyed. We need the resources to rebuild and fortify our economy."


Source: http://mb.com.ph/articles/225478/government-budget-gap-reaches-p2375-billion-first-9-months