Government infrastructure spending down in May

MANILA, Philippines — Government spending on infrastructure slowed down in May due to the suspension of construction activities amid strict movement restrictions to slow the spread of the COVID-19 pandemic, according to the Department of Budget and Management (DBM).

According to the latest data from the DBM, government disbursements for infrastructure and other capital outlays declined by 36.7 percent to P38.9 billion in May from P61.5 billion in the same month last year.

Including equity and capital transfer to local government units (LGUs), total capital outlays amounted to P54 billion during the review period, 24.2 percent lower than the P71.2 billion a year ago.

The DBM attributed the decline in infrastructure spending to the stoppage of construction activities brought about by the extended implementation of strict quarantine measures in Luzon and some key areas in the Visayas region.

Metro Manila, for instance, had been under enhanced community quarantine until May 15.

From January to May, the government’s total infrastructure expenditures amounted to P235.2 billion, a 12.2 percent decline from P267.9 billion in the same period in 2019.

“Infrastructure spending was lower year-on-year due to the base effect of high infrastructure expenditures in the same period last year brought about by the payment of prior years’ accounts payables and the temporary suspension of construction activities due to the enhanced community quarantine,” the DBM said.

Despite the slowdown in infrastructure spending from January to May, DBM data showed that total government disbursements during this period rose by 26.6 percent to P1.66 trillion from P1.31 trillion.

The slack in capital outlays was offset by maintenance spending, subsidy support to government corporations for COVID-19 measures, and allotment transfers to LGUs.

Last March, the government was forced to stop the construction of infrastructure projects due to the community quarantine measures placed in different parts of the country to contain the spread of the virus.

Since then, some areas in the country have already transitioned from enhanced community quarantine to a softer general community quarantine measure, allowing agencies to resume the implementation of some infrastructure projects.