Strong tax collections for the first three months of the year enabled the NG to over perform by P4.2 billion. According to National Treasurer Omar Cruz, this is because of the P13.4-billion excess over the first quarter cash revenue program of P189.4 billion.

"Expenditures exceeded the program on account of the front loading of interest payments as a result of the bond exchange. (However) it is still expected that the actual full year interest payments will be within the programmed level," Cruz said.

The government’s fiscal strategy is to minimize spending and to pump primp.

The inter-agency Development Budget Coordination Committee has approved a new revenue program of P974.2 billion this year from previous target of P968 billion, with the inclusion of non-cash collection of P5.5 billion from the Bureau of Customs.

The DBCC also increased the disbursement level from P1.093 trillion to P1.099 trillion or by P5.5 billion to maintain the P124-billion budget deficit target for the whole year. In 2005 disbursements totaled P942.2 billion.

In the meantime the strong revenue performance of P13.4 billion better than program for the first quarter can be attributed to the P3.8 billion over performance of the Bureau of Internal Revenue, P3.6 billion better than program performance by the Bureau of Customs and P5.7 billion by the Bureau of Treasury.

For the month of March, the deficit was P23.7 billion while revenues totaled P63.8 billion and expenditures was P87.6 billion.

For the first quarter, revenues totaled P205 billion from program of P191.7 billion while the government expenditures totaled P272.6 billion against target of P261 billion.

The phasing of the deficit target is as follows: for the quarterly deficit path, 58 percent to the total deficit target or P72.9 billion was in the first quarter; 6.6 percent in the second quarter or P8.2 billion and P34.8 billion or about 27.9 percent in the third quarter. By the fourth quarter this would be 7.09 percent of the total deficit target, or P8.8 billion.

For 2006 the NG deficit goal is P125 billion. Last year the government incurred a budget deficit of P146.5 billion in 2005, lower by 21.69 percent or P40.5 billion compared to P187 billion in 2004.