Budget hike of 9.2% to P5.75T proposed for 2024
THE proposed 2024 national budget has been set at P5.75 trillion, up 9.2%, the Department of Budget and Management (DBM) said.
In a National Budget Memorandum, the DBM said that next year’s spending plan includes carryover items from previous years.
“The total disbursement program for 2024 is pegged at P5.55 trillion. Of this amount, an estimated P553.6 billion is attributed to prior years’ obligations which are set to be paid in 2024, while P4.99 trillion is intended for projected current-year disbursements,” the DBM said.
“Considering the P756.9 billion obligations to be paid in the succeeding year, the total cash-based budget for 2024 is, thus, set at P5.75 trillion, equivalent to 21.6% of gross domestic product (GDP)” it added.
Assumptions of government revenue for next year have been set at P4.18 trillion, or 15.7% of GDP. The projection represents a 12.2% increase from the P3.729 trillion projection for this year.
“The government will actively pursue several measures to further support revenue growth,” the DBM said.
It cited priority measures such as the Passive Income and Financial Intermediary Taxation Act (PIFITA) and the value-added tax (VAT) on digital service providers, among others.
Meanwhile, the P5.55-trillion disbursement program will account for 20.8% of GDP and is up 6.1% from this year’s disbursements, which are set at P5.23 trillion.
“Given the tight fiscal space amid fiscal consolidation and competing priorities, including mandatory expenses, such as personnel services expenditures and the National Tax Allotment of local government units, budgetary priorities shall be strictly aligned with the medium-term fiscal framework and the Philippine Development Plan,” it added.
According to the DBM, forward projections for succeeding budgets are P5.9 trillion in 2025, P6.4 trillion in 2026, P7.15 trillion in 2027, and P7.88 trillion in 2028.
The memorandum also emphasized the intention to keep infrastructure investment a medium-term priority.
“Notwithstanding the deficit decline in the coming years, the government will invest heavily in the public infrastructures. Infrastructure investment is targeted to reach between 5-6% of GDP within the six-year plan period, and will reach P2.28 trillion by 2028,” the DBM said.
“This amount is nearly twice as much as the deficit by 2028, indicating that borrowings are being maximized for expenditures which have higher multiplier effects on growth,” it added.
The DBM said that agencies must “ensure that proposed programs, activities, and projects (PAPs) are implementation-ready and can be completed within the fiscal year or until the allowable implementation period pursuant to the applicable general and special provisions of the General Appropriations Act.”
“Agencies are therefore expected to undertake measures to improve spending efficiency to be able to fully deliver their proposed PAPs during the budget year,” it added.
Government agencies must also prioritize the completion of ongoing PAPs.
“Those with substantial unutilized appropriations are enjoined to focus on fast-tracking program/project implementation in order to reduce spill-over PAPs,” it added.
The proposed 2024 national budget is due to be submitted to Congress on July 24. — Luisa Maria Jacinta C. Jocson