Cash disbursements to line agencies rise to P1.05 T in May

MANILA, Philippines — The national government picked up the pace of its spending last May following the enactment of the 2019 budget, as well as the conclusion of the election spending ban, according to the Department of Budget and Management.

According to data from the DBM, government agencies utilized P1.05 trillion in notices of cash allocations (NCA) as of end-May, equivalent to 92 percent of the P1.136 trillion NCAs cumulative NCAs released during the period.

The latest performance was an improvement from the NCA utilization rate in the same period last year, which settled at 83 percent. This was also slightly higher than the 91 percent utilization rate recorded as of end-April.

NCAs refer to the disbursement authority issued by the DBM to cover the cash requirements of the operations, programs, and projects of government agencies.

A higher NCA utilization rate demonstrates the capacity of line agencies to timely disburse their allocated funds and implement their programs and projects.

According to DBM Undersecretary Laura Pascua, there was an increase in the use of NCAs last month as it was the first full month since the 2019 General Appropriations Act (GAA) was enacted.

The election ban on public works was also lifted last May 13.

“This (is) the first month after the GAA approval and end of election ban. Hence, agencies would have started paying accounts payables, as well as mobilization fees on new contracts,” Pascua said.

Broken down, the DBM said line departments utilized 90 percent of the P868.9 billion NCAs released from January to May.

NCA releases for government-owned and controlled corporations (GOCCs) and local government units (LGUs) also amounted to P19.9 billion and P246.1 billion, respectively. The DBM said these were almost fully utilized since the funds have already been downloaded to the GOCCs and LGUs by directly crediting their accounts.

Unused NCAs amounting to P85.34 billion may still be utilized by end-June as the cash authority issued by the DBM is valid until the end of the quarter.

Government spending lagged in the first quarter due to the delay in the passage of the 2019 budget. The 2019 GAA was signed by President Duterte last April 15.

With the signing of the 2019 budget, the DBM expects government spending to normalize for the rest of the year.

The Duterte Cabinet’s economic cluster also formulated a catch-up plan, which aims to help the government meet this year’s spending target of P3.774 trillion, and gross domestic product (GDP) growth target ranging from six to seven percent. 

In particular, the Department of Public Works and Highways (DPWH) and the Department of Transportation have committed to accelerate the implementation of big-ticket infrastructure projects and spend P725 billion and P78 billion, respectively, on infrastructure expenditures.