Finance Secretary Benjamin E. Diokno remains optimistic that the national government (NG) would reach its full-year budget deficit ceiling, as agencies are already crafting their catch-up plans to accelerate their spending programs.
Prior to President Marcos Jr.’s state visit to Malaysia, Diokno said he met with the heads of various government agencies and asked them to craft their respective catch-up plans to speed up their spending.
“The problem there is they are underspending. Their budgets were increased significantly but the spending is still not at par. We expect them to come up with a catch-up plan,” Diokno said in a recent press briefing.
Diokno’s statement came a few days after the Bureau of the Treasury (BTr) reported that the national government’s budget deficit fell by 18.17 percent year-on-year to P551.76 billion.
The latest budget deficit was 28.49 percent lower than the NG’s P771.5-billion mid-year deficit program as actual expenditures fell short of target disbursements. (Related story: https://businessmirror.com.ph/2023/07/28/ng-budget-deficit-narrows-18-17in-h1-to-%e2%82%a7551-7b-from-%e2%82%a7674-2b/)
Diokno said the slowest spenders could be the Department of Transportation and the Department of Information and Communications Technology.
He said the weather may have affected the spending programs of the two departments given that they oversee infrastructure projects in the country. He also attributed it to so-called “birth pangs” since the current administration is just a year old.
“I am worried that we are not making our expenditure targets. I am not happy with the smaller deficit,” he said.
“The rule is you cannot spend what is budgeted. Worst case scenario is underspending. On the revenue side we are okay, it is on the spending side [that we have problems],” he added.
Nonetheless, the finance chief said the government’s underspending as of end-June is “not that huge” compared to previous years.
“It is just a matter of time or maybe just procurement delays,” he said.
The national government fell short of meeting its P2.6-trillion programmed spending for the first half of the year. The national government was P170.5 billion short of its P2.582-trillion target expenditure for the period.
“The lower-than-programmed Interest Payments [IP]; ongoing implementation of some social protection programs, particularly the registration and validation of beneficiaries; as well as billing concerns from suppliers/creditors, such as late submissions of billing statements and compliance with documentary requirements have affected the spending outturn for the period,” the Treasury said.