The government is performing well in terms of its revenue collection according to the country’s finance chief, but he raised concerns on the slow spending of government agencies.
In a press briefing last Friday, Finance Secretary Benjamin Diokno shared with reporters the government’s revenue performance for the first five months of the year, which recorded an annual increase of 10.83 percent.
The government collected P1.59 trillion in January to May, P155.6 billion higher versus the P1.44 trillion registered in the same period a year ago.
Tax revenues rose 9.71 percent as the Bureaus of Internal Revenue (BIR) and Customs registered growths of 9.95 percent and 12.1 percent to P1.05 trillion and P359.3 billion, respectively.
Non-tax revenues also jumped 20.56 percent to P178 billion.
Among other factors, Diokno attributed the better collection performance to improved tax administration, citing the BIR’s campaign versus fake or ghost receipts.
The finance chief, however, without citing the latest expenditure figures, raised his concern on the slow spending performance of government agencies.
“Remember we had a surplus (in April), that’s surprising. This reflects on slower spending on the part of the government. It will impact government performance. I’m concerned with the (spending) performance of the government,” Diokno said.
The finance chief was quick to clarify that this has nothing to do with the Department of Budget and Management (DBM) as the agency is able to quickly release funds, explaining that the slow spending is recorded at the agency level.
“The agencies are slow and that will impact the performance. We’re collecting more revenues than forecasted, while they’re underspending. We are below our deficit target. For the fiscal conservative, that’s nice, (but) not necessarily good for a developing country.
That’s not good, because we are trying to pick up, make up for the pandemic,” Diokno said.
Just last month, the DBM called on government agencies to intensify their budget disbursement and spending efforts as the utilization rate slowed down from the previous year.
As of May, the cash utilization rate of government agencies slowed down to 91 percent versus the 93 percent recorded in the same five-month period in 2022.
Diokno said there is still time to adjust the spending performance, with half a year to go.
“I brought this up in the Cabinet. We need to spend. It’s not a lack of money, it’s the ability to perform,” he said.
Asked about the possible reasons for the slow utilization, Diokno said, “We have to talk to these departments. There are probably some newcomers in the government, they’re not used to spending.”
Meanwhile, with the better collection performance year-to-date, Diokno said the government will likely surpass the full-year revenue target for 2023.
