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Patterns of Philippine Expenditure

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Patterns of

Philippine
Expenditure
E
xpenditure system is the
government’s fiscal arm in
producing, allocating and
distributing social goods and
services.
The Developmental Problems of
Developing Countries

Extreme class disparity

Low capital formation and investments

Inadequacy of revenue
Philippine Expenditure Policies

Redistribution of income and wealth and balanced


development.

Economic development.

Stability

Countryside development
Classification of Philippine Public
Expenditures

Level of Nature of
Government Expense

• National • Current
Government Operating
• Local Expenditures
Government • Capital
Expenditures
Classification of Philippine Public
Expenditures
Functional
Type of Funds
Categories
• Economic • General Fund
Development / • Special Fund
Services • Bond Fund
• Social Development/
Services
• Defense
• General Public
Services
• Debt Services
Patterns of Governmental Expenditure
According to Percent Growth and Percent of
Gross Domestic Product (GDP)

35

30

25

20
% of GDP (%)
Percent Growth (%)
15

10

0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Expenditure Patterns According to Nature of
Expenses
1,600,000,000

1,400,000,000

1,200,000,000

1,000,000,000

800,000,000
2010 (Actual)
2011 (Adjusted)
600,000,000
2012 (Proposed)
400,000,000

200,000,000

0
Current Operating Capital Outlays
Expenditures (MOOE, PS)
Expenditure Patterns of the National
Government According to Function

700,000

600,000

500,000

Economic Services
400,000
Social Services
Defense
300,000 General Public Services
Debt Services
200,000

100,000

0
2010 2011 2012 (Proposed)
Conclusions
There is a constant increase in public expenditures caused by
continuous expansion and improvement of governments function and
services.

Urbanization, growing population and changing economic needs of


the people incur more expenses in the government.

The distribution of public expending in different sectors reflects the


priorities of every administration.

Different reduction measures such as streamlining of the bureaucracy


are implemented to reduce the budget deficit. However, the number of
employees continued to grow since the government’s function is
expanding.
Recommendations

Unnecessary spending should be eliminated so that


funds will be diverted to more important services.

Vigilant implementation of existing fiscal policies that will


result in the elimination of corrupt practices in the
government.

Strict monitoring of the spending practices of the


different operating units. This will make sure that only
lawful and important purchases and disbursements are
done.
An Evaluation of
Income and Expenditure
of the Government
for the Year 1997 – 2011
1,600,000

1,400,000

Total Income
1,200,000
Total Expenditures
Surplus (Deficit)
1,000,000

800,000

600,000

400,000

200,000

0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

-200,000

-400,000
Fidel V. Ramos (1992 – 1997)
Fidel V. Ramos (1992 – 1997)

Budget surpluses are


experienced due to
substantial gains
from massive sale
of government
assets and strong
foreign
investments
Joseph Ejercito Estrada (1998 – 2000)
Joseph Ejercito Estrada (1998 – 2000)

Increasing financial
deficits occur during
the Estrada
administration due to
decrease in tax effort
and repayment of the
Ramos
administration’s debt
to contractors and
suppliers
Gloria Macapagal – Arroyo
(2001 – 2009)
Gloria Macapagal – Arroyo
(2001 – 2009)
Income and expenditure
are both increasing
and there are still
large fiscal deficits.
This occurrence is
attributed to
weakening of tax
effort and rising of
debt services due to
peso depreciation.
Benigno S. Aquino III
(2010 – 2011)
Benigno S. Aquino III
(2010 – 2011)

There is a significant
decrease on the deficit
since there is a
strengthening campaign
on tax collection. Fiscal
discipline to state
owned firms and anti-
corruption campaign
during Aquino’s
administration could be
credited.
Thank You!

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