Controlling a high budget deficit, reducing public debt
Last week the Bureau of the Treasury (BTr) released the cash operations report (COR) then the outstanding public debt for August. So here I have compared the date from January to August this year with the data in the same months in previous years, 2019 to 2024.
Revenues are slowing this year compared to 2024, with both the Bureau of Internal Revenue (BIR) and Bureau of Customs (BoC) under the Department of Finance (DoF) having marginal increases in collections. Good thing that non-tax revenues like mandatory remittances by government corporations and finance institutions like LandBank have significantly increased, P182 billion in 2024 and P82 billion in 2025, from almost zero in previous years.
Government spending continues to expand, led by the National Government (NG), local government units (LGUs), and interest payments. Our interest payments alone for the first seven months of the year kept rising, from an average of P1.2 billion/day in 2019 to P1.8 billion/day in 2023, to P2.4 billion/day in 2024, and P2.6 billion/day in 2025.
Our budget deficit has also been rising, from an average of P17.1 billion/month in 2019 to P104.6 billion/month in 2023 and P124.1 billion/month in 2025 (see Table 1).
A continued high budget deficit means rising borrowings and high public debt stock. Our outstanding debt has expanded significantly, from P7.94 trillion in August 2019 to P17.47 trillion in August 2025, more than double in just six years.
On top of that, government’s guaranteed debt in August this year was P346 billion. So the total debt — outstanding plus guaranteed — is P17.82 trillion, huge (see Table 2).
We need a vigorous revenue mobilization even without raising any existing tax rates. It is good that the Vice-Chair of the House Committee on Appropriations, Representative Bella Vanessa Suansing, recognized the DoF’s role in advancing economic growth and safeguarding economic security and prosperity during the House plenary for the DoF’s proposed 2026 budget on Sept. 23.
Yes, Finance Secretary Ralph Recto takes seriously the high revenue challenge every year. Among his important initiatives was raising the mandatory remittances of government corporations and finance institutions to the National Treasury, from 50% to 75% of their net earnings the previous year.
Meanwhile government spending must be controlled. Or spending must be as transparent and accountable as possible to minimize waste and corruption as we see in the ongoing flood control scandal involving both the executive branch, especially the Department of Public Works and Highways, and the legislative branch, both the Senate and House of Representatives. Budget Secretary Amenah Pangandaman’s Open Government Partnership (OGP) program, and the recently signed Government Optimization Act of 2025 or RA 12231, are steps in this direction.
Our public debt cannot go on endlessly rising. It has to stabilize sometime, then work a way towards decline. We should aspire to have sustained revenues; creating new taxes can be justified if there is corresponding removal or relaxation of an existing tax somewhere, then control spending.
We should aspire to have a balanced budget if not a budget surplus in years where there is no economic or social crisis. Then we will have the leeway to enter another budget deficit and contract high borrowings on crisis years someday.
Bienvenido S. Oplas, Jr. is the president of Bienvenido S. Oplas, Jr. Research Consultancy Services, and Minimal Government Thinkers. He is an international fellow of the Tholos Foundation.
