COVID-19 response spending drives fiscal deficit to ₱120.9B in August

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Metro Manila (CNN Philippines, September 23) — The country's budget deficit reached ₱120.9 billion in August as government spending rose, the Bureau of the Treasury (BTr) reported Thursday.

In a statement, the agency said the amount is thrice as high as the ₱40.1 billion recorded in the same month last year, but is lower than the ₱121.2 billion deficit registered in July.

August's figure brings the government's cumulative fiscal deficit to ₱958.2 billion — a 29.36% jump. It's also equivalent to 52% of the revised ₱1.85 trillion program for this year.

The BTr said public expenditure climbed by 34.2% to ₱380.2 billion during the month — the second highest growth recorded this year next to the 37.27% rate logged in February.

The disbursement of several COVID-19 financing requirements such as cash aid to families affected by strict quarantine restrictions in Metro Manila, and subsidy releases to the Philippine Health Insurance Corp. (PhilHealth) led to higher spending in August, the bureau explained.

Meanwhile, interest payments grew by 6.13% in August, reaching ₱23.9 billion due to coupon payments for retail treasury bonds issued last year.

Revenues also increased during the month, but only by 6.59% — hitting ₱259.3 billion.

The Bureau of Internal Revenue raked in ₱186.1 billion, slightly lower by 0.99% according to the Treasury.

The Bureau of Customs, on the other hand, collected ₱53.4 billion in August. Higher by 20.23% from last year, the figure also reflects a ₱133-million deduction in tax refunds, the bureau said.

The Treasury itself hauled ₱4.7 billion in August — more than double its ₱2.1-billion income in 2020 - due to "higher remittance of NG (National Government) share from PAGCOR income, dividend remittances and earnings from BSF (Bond Sinking Fund) investment."

Collections from other offices likewise went up in August by 78.8% to ₱13.9 billion, with the agency citing more relaxed lockdown rules compared to last year.

"The return of ₱4.0 billion unutilized funds under the Bayanihan 1 Act from the Department of Transportation also contributed to the strong performance for the month," the BTr said.