Infrastructure spending down in 7 months

MANILA, Philippines — The government’s spending on infrastructure declined by 9.4 percent from January to July compared to last year’s level due to the suspension of construction activities during the lockdown, the Department of Budget and Management (DBM) reported yesterday.

According to the latest data from the DBM, infrastructure and other capital outlays amounted to P350.3 billion from January to July, 9.4 percent lower than the P386.6 billion recorded in the same period last year.

The DBM attributed the decline to high base effects, as well as the temporary suspension of public works due to the implementation of the enhanced community quarantine measure in Luzon and other areas earlier this year.

Luzon was placed under enhanced community quarantine in mid-March until end-May, prompting a temporary halt in construction activities.

Agencies started to resume the implementation of projects once restrictions were eased to general community quarantine in June.

Despite this, the DBM said infrastructure expenditures in July dropped by 16.6 percent to P52.3 billion from P75.2 billion in the same month last year, which the DBM attributed to timing of payments and the slow implementation of projects amid strict health protocols and the inclement weather.

“This is mainly on account of the one-off expenditure in July last year with the advance payment made by the Department of National Defense for the projects under the Revised AFP Modernization Program,’’ the agency said.

“In addition, disbursements of the DPWH  were lower year-on-year, largely attributed to the gradual implementation of public works amid health and safety protocols in place, as well as the inclement weather in some areas which slowed down infrastructure activities,” it said.

Including equities and capital transfer to local government units, total capital outlays in the first seven months reached P452.4 billion, 2.4 percent lower than the  P463.6 billion a year ago.

Even with lower infrastructure spending, the national government’s disbursements during the seven-month period rose by 23.8 percent to P2.39 trillion from P1.93 trillion in the same period in 2019.

The increase was mainly driven by the implementation of COVID-19 measures such as the Social Amelioration Program, COVID-19 Adjustment Measures program, Small Business Wage Subsidy program, and the health expenditures of the Department of Health.

Moving forward, the DBM said the Bayanihan to Recover as One Act would pave the way for the immediate implementation of COVID-19 programs.

The law appropriates funds amounting to P165.5 billion to strengthen the country’s healthcare system and pandemic response, while providing measures for swift economic recovery from the impact of the pandemic.