THE NATIONAL GOVERNMENT (NG) posted its third budget surplus for this year in May, as revenues outpaced spending, but it was the smallest surfeit so far, according to official data the Bureau of the Treasury released on Tuesday.
The fiscal balance logged a surplus for the second straight month at P2.6 billion in May — smaller than the surfeits of P86.9 billion in April and January’s P44.5 billion — but still turning around from a P32.9-billion deficit a year ago.
May saw revenues grow 22.5% to P317.2 billion from P259 billion a year ago, as collections of the Bureau of Internal Revenue (BIR) grew 19.1% to P204.8 billion from P172 billion and those of the Bureau of Customs increased by 10.3% to P58.2 billion from P52.7 billion. Non-tax revenues — consisting mainly of subsidies to cover taxes on government transactions — surged by 61.3% to P51.8 billion from P32.1 billion.
The government spent 7.8% more at P314.7 billion in May from P291.9 billion a year ago, with interest payments falling 6.8% to P19.7 billion from P21.1 billion and “others” — a category that includes infrastructure and other capital outlays — rising nine percent to P291 billion from P270.8 billion with “implementation of the last tranche of salary increase of government personnel, release of mid-year bonus and the execution of new programs” after the approval in mid-April of the P3.662-trillion national budget.
May cut the year-to-date fiscal deficit by 99.4% to P809 million from P138.7 billion in 2018’s first five months, as revenues grew 10.7% to P1.314 trillion from P1.186 trillion, while the government spent 0.8% less at P1.315 trillion from P1.325 trillion.
This year’s first five months saw the BIR collect 9.8% more at P908.5 billion from P827.7 billion a year ago and the Customs bureau rake in 9.8% more at P251.7 billion from P229.3 billion. Non-tax revenues grew 19.6% to P143.3 billion from P119.8 billion.
In terms of year-to-date expenditures, state interest payments increased by 6.7% to P151 billion from 141.4 billion “reflecting interest on new debt incurred to finance” 2018’s P558.3-billion deficit, while “others” slipped by 1.7% to P1.164 trillion from P1.184 trillion.
Sought for comment, Nicholas Antonio T. Mapa, senior economist of ING Bank Manila, said: “With government spending curtailed for the most part of the current quarter, the government is scrambling to implement ‘catch up’ spending for the second half of the year.”
“The month of May has been a deficit month for the last three years, with the economy getting a nice boost from the government to complement mainstay household consumption.”
Michael L. Ricafort, head of economics research division of Rizal Commercial Banking Corp., noted that the latest data “reflect improved fiscal performance which is a positive factor for the country’s credit fundamentals and overall credit ratings.”
“Government spending already grew at a faster pace in May 2019 by 7.8% year-on-year (would have been faster had it not been for the election ban on some government spending especially on infrastructure) to P314.7 billion after 15% decline year-on-year in the previous month due to the re-enacted budget, may already reflect the approval of the 2019 national budget on April 15, 2019,” he said.
“Thus, faster growth in government spending may already have a more positive impact on the country’s economic growth in 2Q 2019.” — R. J. N. Ignacio