State infrastructure expenditures, other capital outlays rise in October

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Under next year's proposed budget, departments and agencies can incur contractual obligations and disburse payments only for goods delivered and services rendered and inspected within the fiscal year, with an extended payment period of three months. — BW FILE PHOTO

GOVERNMENT SPENDING on infrastructure and other capital outlays grew by double-digit pace at the start of the fourth quarter on road works, purchase of transport equipment and rail extension projects, as agencies ramped up disbursements ahead of the year-end expiry of allotments.

An excerpt of a disbursement assessment report which the Department of Budget and Management (DBM) released to journalists yesterday showed infrastructure and other capital expenditures growing 17.8% to P51.5 billion in October from the P43.7 billion recorded in the same month last year.

At the same time, such expenditures slid by four percent from the P53.6 billion the government spent in September.

The Budget department said the increase was due to public works projects like road repair, upgrading and widening, flood control and rehabilitation or improvement of dike systems by the Department of Public Works and Highways (DPWH); acquisition of transport and other equipment under the Philippine National Police’s (PNP) Capability Enhancement Program; payment for various communication, navigational and air traffic management system projects; as well as consultancy and civil works for the Transportation department’s Light Rail Transit Lines 1 and 2 extension projects.

The 10 months to October saw infrastructure and other capital outlays increase by 11.8% to P442.7 billion from P395.8 billion in the same period in 2016.

This is equivalent to 80.58% of the P549.36-billion infrastructure and capital outlays programmed for this year.

Sought for comment, DBM Undersecretary Laura B. Pascua said in a text message: “The 1 yr validity of obligation appropriations should have guided the agencies for the whole year, and that’s why we saw continuous double-digit growth in infra for the whole year.”

The DBM attributed the increase in year-to-date expenditures to the implementation of the DPWH’s road infrastructure program, the Armed Forces of the Philippines’ (AFP) modernization program, the PNP’s capability enhancement program, repair and rehabilitation of schools under the Department of Education (DepEd) as well as of state universities and colleges, and the Health department’s acquisition of medical facilities and equipment.

The Budget department said it expects state expenditures to pick up further in the year’s last two months.

“Line agencies have been expediting the requests for the release of their allotments, as well as obligating these funds since the 2017 appropriations are valid only until Dec. 31 this year,” the report read.

As of October, the DBM has released P3.018 trillion, or 90.1% of the P3.35-trillion budget for 2017, according to a Status of Allotment Releases.

This means the government had some P332 billion yet to be released to agencies for November and December.

The DBM said that based on a preliminary report, about P137.5 billion worth of allotments were released as of the last week of November.

“The balances from agency-specific budgets meanwhile include mainly the requirements for the Basic Educational Facilities Fund (P73.4 billion), creation and filling up of positions in the DepEd (P33.9 billion) and AFP Modernization Program (P20.0 billion),” the Budget department noted.

“These releases are on top of the releases made earlier this year and could further fan the growth of disbursements in the last two months of 2017,” the report read.

Ms. Pascua noted that the fourth quarter usually sees bigger disbursements from agencies.

“So we expect this trend to continue.” — Elijah Joseph C. Tubayan

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