Gov’t to sustain prudent spending to meet deficit goal — DBM chief

The government will continue to rein in its spending despite posting a budget surplus last April to meet the year-end deficit goal, Budget Secretary Rolando Andaya Jr. said the other day.

"We remain committed to a fiscally-sustainable spending program," he said.

Andaya said the government is targeting a deficit of P124.9 billion this year, based on expenditures of P1.099 trillion and revenues of P974.1 billion.

He said the cash program is anchored on the national budget and other applicable laws.

Andaya also assured the public that politics would never be a factor in the release of funds.

"Releases are calibrated to meet fiscal discipline, development objectives and operational efficiencies," Andaya said.

"There will be no pendulum swing from so-called under-spending to overspending," he said.

Andaya said the Department of Budget and Management would stick to semester disbursement cap of P546.4 billion.

For the first four months of the year, total expenditures reached P350 billion, lower than the programmed level of P366.8 billion.

As a result, the total deficit for the first quarter amounted only to P50.1 billion.

This is lower than the estimated P72-billion deficit for the period, as well as the P59.8-billion deficit posted for the same period last year, Andaya said.

The Budget Secretary also belied reports that the April budget surplus was achieved through "spending cuts."

Andaya said all budget releases are based on a schedule.

"The impression that we deliberately turned off the taps is not true," he said.

"We did not choke spending just for the sake of presenting a glowing report card," Andaya said.

He added the better-than-expected budgetary position during the first quarter was due to improved revenue collections and not a deliberate effort to control spending.

The total allotment releases — the authorization for the agencies to enter into contract for the delivery of goods and services — reached P275.6 billion, he said.

This corresponds to 29.2 percent of the reenacted 2005 level of P942.4 billion in allotment releases. "This reflects the government’s pump-priming and front-loading mode adopted for this year," Andaya said.

He said the total Notices of Cash Allocation (NCA) issuances amounting to P148.6 billion exceeded the programmed level of P138.1 billion.

But because of the additional revenues coming from the 12-percent value-added tax, the deficit resulting to these releases was still lower by P4.2 billion compared to the original target.