Gov’t utilizes 93% of NCAs as of end-July

MANILA, Philippines — State agencies sped up the utilization of funds as of end-July this year following the implementation of the 2019 General Appropriations Act (GAA), the Department of Budget and Management (DBM) said yesterday.

According to the latest data from the DBM, government agencies utilized about P1.569 trillion worth of notices of cash allocation (NCA) from January to July this year.

The DBM said this is equivalent to 93 percent of the P1.688 trillion worth of NCAs released during the seven-month period, a significant improvement from the 73 percent NCA utilization rate seen in January to July last year.

NCAs refer to the disbursement authority issued by the DBM to cover the cash requirements 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 Budget Undersecretary Laura Pascua, the faster NCA utilization as of end-July “may be due to the change in crediting the NCA release for the agencies.”

“Per guidelines on the release of funds, specific monthly allocation is credited on the first working day of each month. Unlike in the previous year, the full quarter requirement is credited on the first working day of the first month of the quarter already,” Pascua said.

National Budget Circular 577 was issued on May 2 this  year to provide the guidelines on the release of funds following the enactment of the 2019 GAA.

Broken down, the DBM said P1.153 trillion of the total NCAs utilized as of end-July was from line agencies. The DBM said this is also equivalent to 93 percent of the total NCAs released to line agencies during the period.

Cash allocations utilized for budgetary support to government-owned and -controlled corporations reached P68.23 billion, while NCAs used by local government units reached P347.63 billion.

The government was forced to operate under a reenacted budget in the earlier part of the year, leading to a slowdown in government spending.

Following the passage of the 2019 General Appropriations Act on April 15, the government economic cluster formulated a spending catch-up plan for the rest of the year.

Earlier, the DBM committed to speed up the release of cash allocations in the second half as this would enable agencies to immediately roll out projects.

The DBM said it is also closely coordinating with other agencies to accelerate budget execution and to catch up with the government’s spending target this year.