Patterns of Philippine

Expenditure

xpenditure system is thegovernment’s fiscal arm in producing, allocating and distributing social goods

and services.

E

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 Government

• National Government

• Local Government

Nature of Expense

• Current Operating

Expenditures• Capital

Expenditures

Classification of Philippine Public ExpendituresFunctional Categories

• Economic Development / Services

• Social Development/ Services

• Defense• General Public

Services• Debt Services

Type of Funds• General Fund• Special Fund• Bond Fund

Patterns of Governmental Expenditure According to Percent

Growth and Percent of Gross Domestic Product (GDP)

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20110

5

10

15

20

25

30

35

% of GDP (%)Percent Growth (%)

Expenditure Patterns According to Nature of Expenses

Current Operating Ex-penditures (MOOE, PS)

Capital Outlays0

200,000,000

400,000,000

600,000,000

800,000,000

1,000,000,000

1,200,000,000

1,400,000,000

1,600,000,000

2010 (Actual)2011 (Adjusted)2012 (Proposed)

Expenditure Patterns of the National Government According to

Function

2010 2011 2012 (Proposed)0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

Economic ServicesSocial ServicesDefenseGeneral Public ServicesDebt Services

ConclusionsThere 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.

RecommendationsUnnecessary 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

199719981999200020012002200320042005200620072008200920102011

-400,000

-200,000

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

Total IncomeTotal ExpendituresSurplus (Deficit)

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!