Record surplus posted

June 17, 2014 at 16:32

An P80.852-billion surplus was registered in April, Bureau of the Treasury data showed, more than double the P36.803 billion seen a year ago. It was also the largest monthly surplus recorded by the government so far, according to Finance department data going as far back as 1990.

The April performance almost wiped out the P84.122-billion deficit recorded as of the first three months of the year, with the year-to-date gap now at just P3.27 billion, narrower compared to P29.675 billion in the first four months of 2013.

The government has capped this year’s deficit at P266.2 billion, equivalent to 2% of gross domestic product (GDP). The gap stood at P164.064 billion last year, equivalent to 1.4% of GDP and well below the P238-billion ceiling.

Revenues collected in April grew by 18.1% annually to P224.449 billion versus the previous year’s P190.01 billion, the data showed. This brought revenue collections for January to April to P622.86 billion, 12.4% higher than the comparable 2013 figure.

Finance Secretary Cesar V. Purisima said in a statement that the government’s take was boosted by the continuing reform efforts at the Bureau of Customs (BoC).

The BoC posted its fourth straight month of double-digit growth in April by raking in P30.764 billion, up 13.4% but still short of the P35.793-billion target. This brought its four-month tally to P117.266 billion, 22% higher than last year’s.

The Bureau of Internal Revenue (BIR), meanwhile collected P156.1 billion in April, 5% more than last year’s result but missing the month’s P176.51-billion goal despite a boost from the annual deadline for the filing and payment of income tax returns.

BIR revenues for January to April reached P420.816 billion, 7% more compared to the same period a year ago.

The Bureau of the Treasury noted, however, that the significant increase in revenues in April mostly came from non-tax sources. The Treasury raised P30.829 billion, almost five times the P6.275 billion it collected a year earlier, bringing its four-month tally to P51.786 billion.

Other offices, meanwhile, added P6.745 billion to the total revenue tally for the month, 11% down from last year and bringing the January to April take to P32.992 billion.

Expenditures failed to offset the strong growth in revenues in April after government spending fell anew. The state spent just P143.597 billion during the month, 6% less than the P153.207 billion recorded a year earlier.

A similar contraction was recorded last December, when expenditures dropped by 16% annually to P202.8 billion from P242.1 billion the previous year — largely blamed on the absence of a yearend spending boost from the Aquino administration’s contested disbursement acceleration program.

April’s expenditures brought the year-to-date spending tally to P626.13 billion, still 7% higher than the P584.01 billion recorded in the first four months of 2013. Treasury data showed that interest payments in April declined by 43% year-on-year to P13.398 billion and, in January to April, by 4% to P116.527 billion.

Nicholas T. Mapa, associate economist at the Bank of the Philippine Islands (BPI), said that netting out interest payments, spending in April grew by just 1%. As for the year-to-date tally, spending besides interest payments grew by a better 10%.

“This is indeed worrisome as this is a time where the government has to step up its contribution to overall growth, and they seem to be holding back as they have for the past four years,” Mr. Mapa said.

“The government has pointed to procurement done in the proper manner but this should not be a reason for the government to scrimp on expenditure now that it has a bevy of fiscal space to work with,” he added.

Mr. Mapa also said the weak spending “only confirms why there has been very little done in terms of rebuilding Yolanda-ravaged areas and very little improvements to overall infrastructure despite double digit growth in infrastructure expenditure.”

“Although the government has been releasing reports showing stark growth in infrastructure expenditure on a growth basis, the actual contribution to overall growth was 0.2 of a percentage point and only grew by 2% year on year for the first quarter,” he added.

Victor A. Abola, economist at the University of Asia & the Pacific, said recent government statements on Yolanda rehabilitation plans — that “works should go full-blast” — could bode well for spending moving forward.

“I think they (the government) will catch up in the second half and reach near their projected deficit for the year,” Mr. Abola said.

BPI’s Mr. Mapa said, however, that the government has long been underspending relative to its goals.

“I am hopeful … [but] I do not see a turnaround where the government has a change of heart and spends in a manner that reflects the urgency of the situation, now that growth appears to be reaching its limits on the household consumption model,” he said.

The government hopes to collect P2.018 trillion in revenues this year and spend some P2.284 trillion.

Source: https://www.bworldonline.com/content.php?section=TopStory&title=Record-surplus-posted&id=88608