MANILA, Philippines (UPDATE) - The government recorded a budget deficit of P18.501 billion in September, with the shortfall in the first 9 months of the year well below the goal for the period, Finance Secretary Cesar Purisima said.
The September budget deficit is lower by 42% compared with the P31.68 billion incurred in the same month last year.
In a statement, Purisima said that last month's figure brought the government’s January to September budget deficit to P52.99 billion, still way below the revised ceiling for the year of P234.35 billion.
“The Aquino administration continues to prove its resolve in improving the Philippines’ fiscal profile. Positive results that we have so far achieved—lower deficit, higher revenues, improving debt ratios— all bode well for the Philippines’ bid for higher credit ratings,” Purisima said.
A budget deficit in September, coming after a surplus in August, was no surprise after the country's top two tax agencies missed their collection targets for the month, and with the government's vow to accelerate spending after a slow start early in the year.
The end-September financing gap was also lower compared with the P259.79 billion deficit registered in the same period last year and the programmed ceiling of P234.35 billion for the period.
“Our successes on the fiscal front are helping us deal with current external challenges from a position of strength. We have the resources to support growth and to protect the vulnerable sectors of our society,” Purisima said.
In September, the Bureau of Internal Revenue (BIR) collected P66.55 billion, 9% higher than the P60.96 billion collected in the same month in 2010.
Meanwhile, the Bureau of Customs generated P22.61 billion in September, 12% higher than the P20.23 billion collected during the same period last year. The rest of the revenues for the month came from the Bureau of the Treasury with P6 billion and other offices with P9.1 billion.
For the 9-month period, government revenue collections stood at P1.017 trillion. Of the amount, the BIR collected P686.26 billion during the period. This was higher than last year’s tax-take of P607.33 billion.
Customs collected P194.61 billion, 2% higher than the P191 billion generated in the same period last year.
The Treasury income was recorded at P68.1 billion while collections from other offices stood at P68.11 billion during the 9-month period.
Expenditures from January to September this year amounted to P1.07 trillion, 7% lower than the comparable disbursements in 2010.
Spending in September reached P122.84 billion, still less compared with P123.58 billion incurred in the same month last year.
Budget Secretary Florencio Abad has said the government may end the year with a budget deficit of at least 2.6% of GDP, below the target of 3% of GDP, despite an expected increase in spending in the second half.
The government has committed to accelerate spending in the remainder of the year after cutting growth forecasts to 4.5-5.5% from 5-6% in 2011 and 5-6% from 5.5-6.5% in 2012.
Manila wants to lower the deficit to 2.6% in 2012 and to 2% by 2013, keeping it at that level until 2016 when President Aquino's term ends. - with Reuters