Pandemic curbs infra spending in Q1

Public infrastructure spending rose in March, but the first-quarter total fell year-on-year and below target partly as the COVID-19 lockdown that started in mid-March stopped the implementation of many projects, the Department of Budget and Management (DBM) said.

In a report Monday, the DBM said the national government’s disbursements on infrastructure and other capital outlays last March increased 4.1 percent to P62.2 billion from P59.7 billion a year ago and jumped by a faster 36.4 percent from P45.6 billion a month ago.

The DBM attributed the increase in the March infrastructure expenditures to “payment of right-of-way acquisitions for the Light Rail Transit Cavite extension and the Metro Manila Subway project of the Department of Transportation, as well as higher constructive cash receipt payments,” referring to direct payments made to development partners’ suppliers when implementing projects funded by official development assistance.

The DBM nonetheless said the government could have had spent more on infrastructure that month, but disbursements were “dampened by lower Department of Public Works and Highways disbursements following the unintended delays in the implementation of some infrastructure projects due to restrictions imposed during the Luzon-wide enhanced community quarantine (ECQ) to control the spread of COVID-19.”

As such, total first-quarter infrastructure spending amounted P156.1 billion, down 12.4 percent from P178.1 billion during the first three months of last year.

It was also 18.3-percent lower than the P191.1-billion goal for the three-month period.

The DBM blamed the base effect of high infrastructure expenditures in the same period last year brought by the payment of prior years’ accounts payables and the temporary suspension of construction activities due to the ECQ for the decline in first-quarter disbursements on infrastructure and other capital outlays.

The below-target infrastructure expenditures as of March were also blamed by the DBM on “the combined effects of the delays experienced during the ECQ, pending submissions of budget requests and documentary requirements for the release of for later release capital outlays as well as the late/incomplete submission of documentary requirements to facilitate release of funds/payments.”

Movement restrictions during the ECQ stopped both public and private construction activity in areas accounting for about 70 percent of the domestic economy.

For instance, the Inter-Agency Task Force on Emerging Infectious Diseases had thumbed down the economic team’s earlier proposal for implementing agencies to continue construction of big-ticket infrastructure projects even as there was a lull in other economic activities during the lockdown.

Under the current modified enhanced community quarantine, some infrastructure projects were allowed to resume as long as complying with minimum safety standards. —Ben O. de Vera INQ