Govt misses 1st-qtr deficit target

POOR COLLECTION, IMPACT ON GROWTH WORRY FISCAL EXPERTS

By Jun Vallecera

Reporter

CONTINUING inefficient collection showed up clearly in significantly lower revenue flows than programmed for the first quarter, totaling only P237.3 billion or 7 percent lower than target. Fiscal experts worry that if this continues throughout the year, such may translate to poor economic growth. Disbursements for the same period only grew by a modest 6 percent to P289.3 billion, an indication of government's continuing reluctance to loosen up its purse strings given its commitment to spend at least P301.6 billion or P12.4 billion less than it budgeted. The economic managers poured much of it into various infrastructure programs. This could hound Finance Secretary Margarito Teves, budget chief Rolando Andaya, and Socioeconomic Planning head Romulo Neri later on if poor collection denies them the targeted revenues needed to continue fueling the country's growth set by government at 6 to 6.5 percent—but already pared down to barely 6 or much less by international financial institutions. But Malacaٌang on Monday remained confident that government can meet its P63-billion target deficit for the year despite overshooting its first-quarter target by P7 billion, or P52 billion instead of just P45 billion. Press Secretary Ignacio Bunye recalled government had been on a similar road in the past but still managed to attain targets. "Based on our experience last year, we also did not meet some quarterly targets but on a year by year basis were able to achieve our targets. We believe that it will be the same this year. We will achieve our yearend targets." He didn't believe the missed deficit target for the first quarter had set a trend "because our fundmentals are very sound." Accelerated spending on infrastructure was supposed to boost growth, seen averaging 6.1 percent this year, and it seems such spending had been slower, although the government said there is hope yet the infrastructure budget would actually be spent according to the book as the months pass. The deficit of P33.4 billion in March represented a rise of more than 22 percent from year-ago level of P27.2 billion, indicating an underlying resolve to try to observe the spending level this year as originally planned, according to official sources. The collection agencies also gathered 10 percent more revenues than a year ago to P75 billion, in part because Internal Revenue chief Jose Mario Buٌag boosted his collections in March by more than 19 percent to P52.1 billion. Buٌag outperformed both Customs chief Napoleon Morales and Treasury head Omar Cruz. Both missed their goals by 10.1 percent and 22.1 percent, respectively, with Morales delivering only P15 billion versus P16.7 billion last year and Cruz coming up with P3.7 billion versus P4.8 billion last year. A closer look at the deficit data show government subsidy expenditures growing sharply by 67 percent in the first three months to P6 billion, nearly double last year's P3.6 billion. Local government spending also jumped 29 percent to P51.6 billion when the plan was for only P47 billion and year ago was only P39.9 billion.  Interest payments fell lower than program to just  P89.1 billion from year-ago level of P103.8 billion or even lower than expected interest payments for the period of P94.3 billion.  --With  M. Gonzalez

 

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