PH infra spending declined in August

The negative impact of the delayed budget approval on public infrastructure spending spilled over to August, during which disbursements fell from year ago and month ago levels, the latest Department of Budget and Management (DBM) data released Monday showed.

The government’s expenditures on infrastructure and other capital outlays in August amounted P59.3 billion, down 13.2 percent from P68.4 billion during the same month last year.

Infrastructure disbursement that month also dropped by a faster 21.1 percent from P75.2 billion in July.

In a report, the DBM still blamed “delays in the implementation of new projects which stemmed mainly from the late passage of the 2019 budget and the election ban.”

The government underspent P1 billion a month on public goods and services between January and April when it used reenacted appropriations instead of the P3.7-trillion 2019 national budget, passage of which was stalled by squabbles in Congress over alleged “pork” funds.

In the case of infrastructure, end-August expenditures declined 11.8 percent to P446 billion from P505.6 billion during the same eight-month period last year.

The DBM said infrastructure disbursements in September likely had a boost from the P13.3 billion released to the Department of Transportation (DOTr) to cover its right-of-way requirements.

The government earlier set into motion a “bold” spending catch-up plan, under which the major infrastructure agencies, namely the DOTr and the Department of Public Works and Highways (DPWH), would speed up implementation of P803 billion worth of projects until year-end.

However, the World Bank this month said that “there are still implementation challenges that might prevent a full catch-up.”

According to the World Bank, among the “persistent” challenges seen delaying expansion in public investment included the limited capacity of both implementing agencies and the private sector to immediately absorb projects.

In its Sept. 30 midyear report on the fiscal year 2019 national budget, the Cabinet-level, interagency Development Budget Coordination Committee (DBCC) claimed “disbursements are gradually accelerating, and it is expected that the spending commitment of both the DPWH and the DOTr will drive disbursements for the rest of the year.”

“The completion and/or partial completion of infrastructure works and submission of corresponding progress billings should also propel government spending in the second semester,” the DBCC said.

“Spending is expected to gradually recover towards the end of the third quarter. This is manifested with the continued implementation of government programs and projects, as well as the submission of progress billings from completed and/or partially completed infrastructure projects, actual services rendered, and deliveries made from the obligations incurred during the previous months,” it added.