Gov’t infra, capital outlay jumps 50%

MANILA, Philippines - Government spending for infrastructure and capital outlay jumped 50.1 percent in the first quarter of the year to P58.1 billion, the Department of Budget and Management reported yesterday.

This, along with improved spending for maintenance and other operating expenditures (MOOE), which expanded by 25.1 percent to P70.4 billion as of March, helped push first-quarter disbursements to P430.8 billion.  The amount is 9.1 percent higher than the previous year.

Disbursements amounted to P148.8 billion in March alone, up 3.3 percent from  last year’s level.

 â€œAlthough our year-on-year growth figures for the first quarter may appear unremarkable, the data that defines these spending levels is actually very encouraging. We were able to make dramatic improvements in our infrastructure and MOOE disbursements, mostly because we routed more budgetary support to these items, instead of devoting more funds to tax subsidies and interest payments,” said Budget and Management Secretary Florencio “Butch” Abad.

“In other words, the single-digit growth is actually the result of us spending less on items that contribute little to our development strategy, such as tax subsidies to GOCCs or maturing loans for other entities outside the National Government. We’re also working with lower interest rates that can help widen our fiscal space, which will ultimately favor the administration’s socio-economic growth platform,” Abad added.

According to the DBM, year-on-year spending levels for net lending plunged by over 300 percent in the first quarter, while tax expenditure funds (TEF) dived by 83.5 percent. Interest payments also slowed down by 0.2 percent

“Besides the improved pace of expenditures for the first quarter, we’re seeing greater precision in the way we’re implementing the budget. Disbursements are going exactly where they’re urgently needed: in programs and projects designed to boost our growth prospects, and which will translate to direct, immediate, and sustainable benefits to all Filipinos,” Abad said.

Infrastructure and capital outlay climbed 50.1 percent or P19.4 billion, due largely to increases in both current and prior years’ payables for contractors of infrastructure projects and equipment suppliers.

As of end-March, the Department of Public Works and Highways has released around P34 billion to its creditors to pay for goods and services, 76 percent higher than last year’s P19.3 billion.

MOOE also rose by 25.1 percent to peak at P70.4 billion. The amount reflects the P14.6 billion in cash grants for the implementation of the Conditional Cash Transfer program under the Department of Social Welfare and Development.

Higher MOOE disbursements also account for the implementation of other key socio-development programs, including those that provide access to safe and potable water, public health care services, agriculture development programs, and improved public education.