Budget releases crawl on slow spending

MANILA, Philippines – Budget released to agencies by end-November barely inched up from the previous month, highlighting slow spending concerns and putting pressure on the government to shell out as much funds as possible by yearend.

A total of 96.4 percent or P2.511 trillion of the P2.606-trillion national budget this year was already deemed released to state departments and other entities, data from the Department of Budget and Management (DBM) showed.

The figure barely went up from 95.1 percent in October, but was much higher than the 94.9 percent posted in the same period last year.

“No budget is ever released 100 percent. That is like being able to perfectly predict what your total needs are a year before you incur them,” Budget Secretary Florencio Abad said in a text message.

“That is not possible,” he said when sought for comment yesterday.

The Aquino administration has come under fire for persistently falling below its target spending this year despite double-digit growth in revenues. As of September, expenditures of P1.631 trillion is 14 percent behind the nine-month program.

Allocations getting released means agencies may now enter into obligations where they pay for specific products and services. After obligation, actual disbursement takes place once payments are made.

Only once an agency actually paid for products and services is the data recorded on the monthly government fiscal performance.

By average, Abad said the national government is able to release 98 percent of the national outlay every year. “If we hit that (this year), then we are fine,” he said.

He explained that since the budget is crafted a year before it is spent, spending estimates may change, while “unforeseen” budget amendments could also be introduced by Congress that may affect actual costs.

Broken down, DBM data showed 97.4 percent of departmental budgets have already been released. That translates to P1.3 trillion versus this year’s P1.334-trillion program.

Special purpose funds, which include calamity and contingent funds, amounted to P286.74 billion as of November, 70.6 percent of the P405.92 billion allocated this year.

Automatic appropriations – covering retirement pension payments, debt interest allocations and local government share of NG revenues – reached P836.90 billion, 96.6 percent of program.

Once the budget is released, agencies would still need to secure notices of cash allocation (NCA) from the DBM, which they will use to get checks from the Bureau of the Treasury.

Once NCAs are utilized, disbursement is deemed to have taken place.

Earlier, separate DBM data showed P1.675 trillion in NCAs have already been released, of which 92 percent or P1.547 trillion were already encashed.