Marcos budget deficit held in check by slow public spending
Published Nov 26, 2025 03:39 pm
Probes into public works constrained government spending, containing the Marcos administration’s 10-month budget deficit but potentially slowing economic recovery. (PCO photo)
Sluggish government expenditure, constrained by ongoing probes into public works, helped contain the 10-month budget deficit but raised concerns over the effective delivery of key economic stimulus programs.
The Bureau of the Treasury reported on Wednesday, Nov. 25, that the Marcos administration’s fiscal deficit reached ₱1.11 trillion in January to October 2025, with spending growth lagging despite the surge in monthly collections that kept the gap within its full-year program.
In October alone, the national government recorded a budget surplus of ₱11.2 billion, a 76 percent leap from the ₱6.3 billion surplus in the same month a year earlier.
According to the Treasury, this strong closing month helped contain the 10-month deficit to 70.83 percent of the revised ₱1.56 trillion full-year ceiling, underscoring the government's commitment to fiscal consolidation despite slower growth figures.
The end-October financing gap was primarily driven by restrained disbursements, as expenditures grew by a modest 3.9 percent in the first 10 months, outpacing revenues that edged up by only 1.13 percent.
The revenue figure was heavily affected by the non-recurrence of large, one-time non-tax receipts recorded in 2024. Economists view the slower spending as a short-term drag on economic recovery, particularly on capital-intensive projects.
Total revenues for the 10-month period amounted to ₱3.81 trillion, climbing ₱42.4 billion from last year and reaching 84.25 percent of the revised ₱4.52 trillion full-year program.
Tax revenue climbed 7.45 percent to ₱3.47 trillion, making up the vast majority of collections.
The Bureau of Internal Revenue (BIR) delivered a strong 9.55 percent year-on-year increase, collecting ₱2.65 trillion, fueled by robust collections across core areas, including corporate and personal income taxes, value-added tax, and excise tax on tobacco products.
Separately, the Bureau of Customs (BOC) collected ₱784.6 billion, a slight 0.91 percent improvement, driven by roader tax base from dutiable and non-dutiable imports, although this growth was partially countered by lower duty collections on rice due to a recently instituted import ban.
Meanwhile, non-tax revenues plummeted 36.71 percent to ₱341.3 billion, a ₱198.0 billion drop, due to the absence of the previous year’s “windfall receipts.” Despite the steep decline, non-tax income has already surpassed the ₱306.5 billion revised 2025 program by 11.37 percent.
Cumulative expenditures totaled ₱4.91 trillion, hitting 80.8 percent of the ₱6.08 trillion revised full-year program. The minimal 3.9 percent growth was largely due to a slowdown in core primary spending.
Primary expenditures (₱4.19 trillion), accounting for 85.28 percent of the total, rose just 2.45 percent.
The government linked the slower pace to a contraction in infrastructure spending, citing an
“ongoing probe” into flood control issues and a review of project implementation at the Department of Public Works and Highways (DPWH).
Conversely, interest payments (IP) climbed sharply, rising 13.24 percent (₱84.5 billion) to ₱723.2 billion, comprising 14.72 percent of total disbursements, reflecting the elevated cost of servicing the national debt.
The resulting year-to-date primary deficit (excluding interest payments) widened by 17.74 percent to ₱382.9 billion, underscoring the dual pressure of financing government programs while handling rising debt servicing costs.