THE National Government’s budget deficit widened to P23.4 billion in January, as spending increased due to the release of tax allotments to local government units (LGUs).

Data from the Bureau of the Treasury released on Thursday showed the January fiscal gap jumped by 66.3% from the P14.1-billion deficit a year earlier. Month on month, the fiscal gap sharply narrowed from the record P338 billion in December.

“That is still the narrowest budget deficit in a year, as the economy reopened further,” Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort said in a text message.

Expenditures grew by 9.7%, outpacing the 6.65% increase in revenues during the month.

The BTr said total disbursements rose to P301.5 billion in January, “partly due to higher national tax allocation releases” to LGUs. The allocation replaced the internal revenue allotment, following the Supreme Court’s Mandanas ruling.

The ruling is named after Batangas Governor Hermilando I. Mandanas, who successfully challenged the government’s previous position that LGUs were entitled to a smaller share of National Government funds.

Starting this year, LGUs will get a bigger share in tax collections, alongside the transfer of basic services.

Accounting for 78% of the total, primary expenditures stood at P235.9 billion in January, up by 3.57% year on year. Interest payments rose by 39.4% to P65.6 billion in January.

“Interest payments accounted for 23.57% of revenue and 21.74% of expenditures, up from last year’s 18.04% and 17.11%, respectively,” the BTr said.

Meanwhile, total revenues increased by 6.65% year on year to P278.1 billion in January.

Accounting for 92% of the total, tax collections rose by 10.5% to P255.3 billion.

The Bureau of Internal Revenue (BIR) collected P195.8 billion in January, up by 7.48% from P182.2 billion a year earlier.

Collections by the Bureau of Customs (BoC) went up by 23.43% to P58.3 billion, which was attributed to higher valuation, stricter enforcement against illegal imports, traders’ better compliance with Customs laws and a slight improvement in import volume.

Nontax revenues fell by 23.28% to P22.8 billion, as BTr income plunged by 41.75% to P10.9 billion during the month. This was due to the high base effect of dividend remittances a year ago.

Mr. Ricafort said the deficit widened due to tighter restrictions caused by the Omicron surge in January. A further reopening of the economy would eventually lead to higher tax revenue, he added.

“This could help narrow the country’s budget deficit and lower the country’s debt-to-GDP (gross domestic product) ratio amid faster economic growth, thereby making debt management more sustainable over the long term and for the coming generations,” he said.

Metro Manila and most parts of the country are under the most relaxed Alert Level 1 as coronavirus infections decline.

ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa said actual spending was muted as the bulk of expenditures were due to higher interest payments.

“This reflects the reluctance of officials to spend as they remain wary of the fiscal position which is now at a relatively vulnerable position given the high debt and deficit ratios,” he said in an e-mail.

Mr. Mapa said revenue collection showed an improvement but has not fully recovered.

“This indicates that the reopening has not resulted in the type of inflows that the government may have hoped for… These developments become increasingly important as authorities struggle to deal with the fallout from the ongoing geopolitical conflict while limiting the impact on an already tenuous fiscal position,” he added.

The government has set a budget deficit ceiling of P1.65 trillion for 2022, which is equivalent to 7.7% of GDP.

The government runs on a budget deficit when it spends more than it makes to fund programs that support economic growth. It borrows from foreign and local sources to plug the gap. — Tobias Jared Tomas

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Marketers were faced with the loss of cookie data, but this move to a cookie-less world was then postponed. Meanwhile, an increase in ‘opt-out’ legislation, has led to a reduction in the amount of data available to drive B2B marketing strategies and fuel campaigns.

Jon Clarke, Founder and Chief Product Officer of Cyance, a leading provider of European intent data, has reviewed the current landscape and shares his thoughts on how the data landscape will shift in 2022, and how B2B marketers can capitalise.

As the tracking cookie continues to crumble, the big question on marketers minds is ‘what will we do now?’. How are we supposed to understand our customers and future proof our tech stack and marketing strategy?

The good news is, despite all of the change and uncertainty, 2022 will provide plenty of opportunities for B2B marketers to re-define their use of data, driving better engagement with prospects and optimizing their campaign performance.

Cookies will be yesterday’s tech by the end of 2022

Whilst the cookie deprecation has been delayed, more and more people are opting out of cookies. Firefox and Safari have already blocked tracking cookies by default, and Google itself has announced that it won’t roll out alternative user-level ad identifiers as a replacement for third-party cookies. Making cookies a null and void entity, long before the deprecation deadline.

As such, B2B marketers will turn their backs on cookies over the coming months and will need to look towards MarTech and AdTech to provide a longer term solution that generates the same, if not better, insights into customers and prospects. One such solution is Universal IDs.

B2B marketers will come to realise the potential of Unified IDs

Unified IDs present an opportunity for the marketing industry to thrive in a cookie-less world by building a unique ID for users that can be tracked across the entire digital ecosystem, without the need for additional syncing. Unified IDs represent a personal, static, exchangeable, and interoperable identifier for each user, taking into account their multiple touchpoints.

Already we’re seeing innovative B2B marketers exploiting the numerous advantages that Unified IDs have over cookies. Firstly, they have a longer shelf life than cookies, making it much easier to build audiences, attribute behaviour trends and measure activation outcomes over time. Plus, Unified IDs work in an omnichannel manner by definition, and I expect to see an expansion of data sources beyond the traditional and including more modern channels such as SmartTVs and wearables. Finally, I predict that the increased use of Universal IDs will translate into much more reliable and accurate data for the marketer, providing a wider picture of intent.

A seismic shift towards Account-Based Marketing (ABM)

2021 has already seen a significant shift to Account-Based Marketing (ABM), with 70% of marketers reporting that they use ABM, up from 15% from 2020. But I expect to see this dynamic accelerating even further over the next 12 months.

More and more B2B marketers are experiencing the benefits of a personalised and targeted approach in their campaigns. We now have the required technology and the accurate data – it’s only a matter of time until we reach 100% ABM within B2B.

ABM provides a much more personalised marketing approach, encourages both marketing and sales teams to align, and as a result, it shortens the sales cycle. ABM is so much more precise and measurable than traditional approaches, providing clearer ROI and more efficiency in marketing and sales teams.

ABM is also a more tempting solution for marketers as marketing expenditure, as a percentage of revenue, is at its lowest point in over a decade. Marketers are looking for solutions that do more with less. ABM does just that, its efficient and targeted form of outreach results in less wastage than traditional mass advertising and less targeted digital strategies.

Quality over quantity in B2B data

For years, the sales and marketing industry has been of the opinion that, when it comes to data, the more the better, quantity over quality! This has been particularly true during the pandemic, where many businesses have tried to make up for in-person and telephone sales. Instead choosing to reach out through digital content and channels, without truly appreciating the buying stage, or digital journey of the modern B2B buyer. As a result, we’ve seen that buyers are feeling inundated with messaging that lacks context and relevance.

So, as B2B demand generation teams become cognisant of this, I expect to see a much needed shift in attitudes in 2022, with marketers looking to strip down their use of data to focus only on the most useful, relevant and accurate insights. By cutting through the data noise which has become such a distraction over recent years, marketers can instead concentrate on getting a clear view of buyers’ intentions and their position in their buying journey. Nothing else really matters, and this is something greater numbers of B2B marketers will recognise over the next 12 months.

Marketers will integrate data to get a complete view of the customer

Finally, in line with a streamlined set of data points, I also expect marketers to look to remove data silos and integrate all of their insights into one unified platform. This will allow them to generate a much clearer and more accurate picture of their audiences.

In particular, I expect to see more integration between different data sources, such as 1st party and 3rd party intent data. This in turn will be layered with wider insights such as firmographic and technographic data. In doing so, B2B marketers will begin to get a full view of the customer.

B2B marketers that embrace these shifts in the data landscape, and adapt their strategies and campaign activations accordingly, will undoubtedly come out on top next year.

Read more:
How the shifting data landscape will re-shape B2B marketing in 2022

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