Gov’t to shift to quarterly reporting of deficit

Beginning next month, investors would no longer have access to information on the government’s fiscal performance, including the budget deficit, on a monthly basis.

The Cabinet-level Development and Budget Coordinating Committee (DBCC) announced yesterday it would be reporting on the government’s fiscal performance on a quarterly basis instead.

The National Government deficit was among the factors being considered by investors in gauging the direction the Philippine economy would take in the near-term.

This could also sway decisions of investors to put in more money either in portfolio or foreign direct investments.

It has also directly affected market appetite for government securities, particularly Treasury bills and Treasury bonds.

A statement issued by the Investor Relations Office explained that "the switch to quarterly report is aimed to align the performance report with the quarterly cash program of the DBCC."

Investor Relations Office executive director Cora Guidote said the move was meant to assure "data accuracy in the report given that different agencies and departments are involved in the generation of the financial data." "The quarterly report will give the Treasury Department, which accounts for the fiscal accounts on the cash basis, ample time to validate the numbers with the respective agencies which account for their respective accounts on an accrual basis," she said.

She also stressed that "the quarterly report will minimize speculative activity that may be derived from the volatile nature of the monthly reports, which reflect seasonal factors, in particular interest payments."

She explained that "many of the government’s bonds are scheduled to pay interest during the last month of each quarter."

This fact may cause a slight increase in the deficit numbers for the last month of each quarter, a development which, at times, caused nervousness in the market. – PNA