Gov't expenditures widen budget deficit by 43% in May

By Komfie Manalo

The administration’s accelerated spending ballooned the national government’s budget deficit to P174.9 billion, or 43.10% higher, in May, with expenditures outpacing revenue collection, the Bureau of Treasure (BTr) said.

“The increase was driven largely by the implementation of capital outlay projects of the Department of Public Works and Highways and the Department of National Defense, as well as the social and health programs of the Department of Social Welfare and Development and the Department of Health, respectively,” the BTr said.

It added the higher government spending “pushed disbursement growth for the month to 22.4%, as against revenue expansion of 14.59%.”

BTr data showed that state collections in May amounted to P382.1 billion, up 14.59% from the P333.4 billion in the same period last year.

Higher non-tax collections underpinned the month’s strong revenue performance.

The year-to-date collection stood at P1.9 trillion, outperforming the previous year’s outturn by 16.34% or P260.2 billion.

Of the total amount, 85.59%, or P1.6 trillion, was generated through taxes, while the remaining 14.41%, or P267 billion, came from non-tax sources.

Nat’l expenditures

National government expenditures, meanwhile, amounted to PHP557 billion in May, 22.24% higher compared to the P455.7 billion spent a year ago.

The Treasury noted that the higher national tax allotment shares of local government units and increased budgetary support to government-owned and controlled corporations also contributed to the growth of disbursements in May.

Total state expenditures from January to May stood at P2.3 trillion, up 17.65% from the P1.9 trillion posted in the same period in 2023.

Primary expenditures for the month reached PHP495.9 billion, recording a 19.69% growth from last year.

On the other hand, interest payments amounted to P61.1 billion in May, reflecting a 47.78% year-on-year growth due to additional debt incurred last year and higher interest rates of both domestic and foreign borrowings.

For the first five months of the year, the fiscal deficit widened to P404.8 billion, 24.06% or P78.5 billion more than the P326.3 billion recorded during the same period in 2023.