Infra spending slows down in H1

MANILA, Philippines — Public spending on infrastructure fell behind program in the first half of the year owing to the delay in the passage of the 2019 national budget and the election ban, the Department of Budget and Management (DBM) said yesterday.

According to the latest data from the DBM, infrastructure and other capital outlays in the first six months dropped by 11.7 percent to P311.4 billion from P352.7 billion in the same period last year.

This was likewise 20.8 percent below target, which was set at P392.9 billion for the period.

Including equity and capital transfers to local government units, the government’s total capital outlay in the first semester fell by 15.7 percent to P377.5 billion, as compared to P447.5 billion in the same period last year.

This was also 21.1 percent below the P478.7 billion target during the six-month period.

For the month of June alone, spending on capital outlays decreased by 33.2 percent to P55.8 billion from last year’s level of P83.5 billion.

“This is largely due to the delayed implementation of various infrastructure projects following the late approval of the FY 2019 General Appropriations Act and the election ban,” DBM said.

According to DBM, the drop in infrastructure spending in the first half led to the 0.8 percent decline in overall government disbursements during the same period, which reached P1.59 trillion as compared to P1.6 trillion a year ago.

This was also 7.3 percent below the program amounting to P1.72 trillion.

Republic Act 11260 or the 2019 General Appropriations Act (GAA) was only signed by President Duterte last April 15, forcing the government to operate on a reenacted 2018 budget in the first quarter of the year.

To make up for this, the Cabinet economic cluster formulated a spending catch-up plan for the rest of the year.

Given this, DBM said bulk of disbursements, especially on infrastructure projects, is expected to come in by the latter half of the year.

“For instance, the Department of Public Works and Highways (DPWH) anticipates that their spending will pick up in the third quarter and peak in the fourth, barring any other significant delays, such as weather disturbances and other implementation bottlenecks,” DBM said.

DBM has committed to monitor the performance of implementing agencies which promised to accelerate their spending in the latter half of the year, in order to achieve the government’s economic growth target of six to seven percent for 2019.