The government, true to its word, is spending as fast as it can to put the economy back on its growth track.
The Bureau of Treasury early this week reported that the budget deficit jumped 86 percent in September to P178.6 billion from P96.2 billion year-on-year on the back of a 39-percent increase in government expenditures.
The expenditures in September reached P415.1 billion, up from P298.6 billion in the same month last year, while revenues rose 17 percent to P236.5 billion from P202.4 billion.
Finance Secretary Carlos Dominguez III has said the government must play catch-up spending in the second half of the year to reverse the lackadaisical economic growth of less than 6 percent in the first two quarters of 2019. The delay in the approval of the 2019 budget and the election ban in the run-up to the May elections restricted state spending and eventually slowed down economic growth.
The government was forced to halt the construction of major and minor infrastructure projects in the first and second quarters, while critical expenditure plans to boost the economy were in limbo as a result of the budget impasse.
The catch-up spending plan was very evident in September when the government disbursed P415.1 billion, the fastest in the first nine months of 2019. The big September figure boosted the nine-month spending to P2.6 trillion, or just 2 percent behind the cumulative expenditure target.
The national government, says the Treasury, continued to catch up with its spending plan for the year where 71.2 percent of the P3.769-trillion, full-year program should be disbursed in the nine-month period despite the delay in the passage of the 2019 budget and the election ban in the earlier part of the year.
The catch-up spending is similar to pump-priming, where the state resorts to heavy spending in a recessionary environment to shore up economic growth. The government this time has to accelerate spending toward the latter half of 2019 to make up for the missed opportunities in the first half of the year.
