Sound fiscal and monetary policies that foster macroeconomic stability are crucial to achieving sustained economic growth. A sustainable fiscal balance helps the country avoid boom-bust cycles that disrupt the pace of economic growth. Appropriate levels of fiscal deficits also allow the government to continuously support critical social programs and infrastructure projects. Prudent and responsible monetary policy that achieves low and stable inflation, in turn, gives both consumers and businesses a chance to plan over a longer time horizon. At the same time, it helps ensure that financial markets are stable and credit conditions are appropriate to support the continuous expansion of economy.
Table 2.3. Summary of Fiscal Sector Indicators, 2004-2010 (in million PhP)
Particular | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | |
Total Revenues | 706,718 | 816,159 | 979,638 | 1,136,560 | 1,202,905 | 1,123,211 | 1,207,926 | |
604,964 | 705,615 | 859,857 | 932,937 | 1,049,179 | 981,631 | 1,093,643 | ||
470,329 | 542,697 | 652,734 | 713,605 | 778,571 | 750,287 | 822,623 | ||
127,269 | 154,566 | 198,161 | 209,439 | 260,248 | 220,307 | 259,241 | ||
Others | 7,366 | 8,352 | 8,962 | 9,893 | 10,360 | 11,037 | 11,779 | |
101,754 | 110,544 | 119,781 | 203,623 | 153,726 | 141,580 | 114,283 | ||
Total Disbursements | 893,776 | 962,938 | 1,044,429 | 1,149,001 | 1,271,022 | 1,421,743 | 1,522,384 | |
Current Operating Expenditures | 755,748 | 831,716 | 904,179 | 947,357 | 1,031,849 | 1,141,967 | 1,229,785 | |
Personal Services | 283,065 | 296,361 | 324,690 | 350,291 | 374,662 | 414,023 | 469,402 | |
83,838 | 84,753 | 99,993 | 128,311 | 138,690 | 176,458 | 182,092 | ||
6,926 | 8,151 | 11,884 | 21,686 | 16,982 | 17,438 | 21,005 | ||
Allocation to LGUs | 114,068 | 122,194 | 136,865 | 149,150 | 170,583 | 203,233 | 216,079 | |
Interest Payments | 260,901 | 299,807 | 310,108 | 267,800 | 272,218 | 278,866 | 294,244 | |
132,352 | 129,515 | 140,120 | 191,894 | 224,780 | 274,712 | 283,340 | ||
5,676 | 1,707 | 131 | 9,750 | 14,393 | 5,064 | 9,258 | ||
Fiscal (Deficit)/Surplus | (187,058) | (146,779) | (64,791) | (12,441) | (68,117) | (298,532) | (314,458) | |
Sources: Bureau of Treasury (BTr), Department of Budget and Management (DBM)
Note: Table 2.3 was based on 2011 Fiscal Statistics Handbook and Cash Operations Report as of September 2010.
This section thus addresses the issues of macroeconomic stabilization. Performance and challenges in the fiscal and the monetary or external sectors are first addressed. Strategies that need to be adopted to achieve macroeconomic stabilization are then outlined.