Reduced budget deficit, on track with our agenda for prosperity

Id Mubarak! Taqabbalallahu Minna wa Minkum. Assalamu alaikum wa Rahmatullahi wa Barakatuh.

- Amenah F. Pangandaman

Last February, we were pleasantly greeted with the report that our budget deficit for fiscal year (FY) 2024 went down to 5.7 percent of our Gross Domestic Product (GDP), or P1.506 trillion. According to the Bureau of the Treasury's Cash Operations Report on the national government's full-year fiscal performance for 2024, this is the lowest deficit recorded since the pandemic started in 2020.

For those unfamiliar with the term, a budget deficit occurs when we spend more than what we earn.

I believe the decline in the budget deficit is, in large part, due to the dynamic leadership of President Ferdinand R. Marcos Jr. (PBBM). In his 2024 Budget Message, the President urged, "For the next five years, we must do more, building on all the gains that we have made-through the whole-of-government and whole-of-society approach. We need this not only to be effective but to be transformative."

It is also the result of the strategic management efforts of the Philippine Economic Team, who have been at the forefront of ensuring that the macroeconomic targets of our administration are met.

Fiscal consolidation on track

It may be recalled that the FY 2023 deficit was 6.2 percent of GDP, or P1.512 trillion. The narrower fiscal gap for the year, vis-à-vis the 7.3 percent budget deficit in 2022, was attributed to the 7.86 percent increase in revenue collection, surpassing the 3.42 percent growth in government spending, indicating progress in fiscal consolidation.