INFRASTRUCTURE spending fell 38.3% month on month in October to P61.2 billion, according to the Department of Budget and Management (DBM).

The DBM said on Tuesday that on a year-on-year basis, expenditure on infrastructure and other capital outlays rose 0.5%.

The DBM said in October, disbursements fell for the Armed Forces of the Philippines Modernization Program, which offset the increased spending on infrastructure projects overseen by the Department of Public Works and Highways (DPWH) and Department of Transportation.

Spending was also affected by the minimal direct payments made by donor partners for foreign-assisted projects, it added.

In the 10 months to October, infrastructure spending rose 12.3% to P788.9 billion.

Citing preliminary figures, the DBM also noted in a report that disbursements for November were positive, driven by capital outlays for DPWH projects.

“This robust spending performance is expected to continue for the rest of the year as line agencies catch up on the implementation of their programs and projects and settle outstanding due and demandable obligations before the year ends,” it added.

UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said October spending was “consistent” with the government’s narrower budget deficit and even lower debt stock.

“This may be a deliberate effort since debt targets for the year were already breached,” he said in a Viber message.

The National Government’s outstanding debt inched up 0.02% to P13.644 trillion at the end of November.

Year on year, the debt stock increased 14.35%.

Meanwhile, the budget deficit narrowed 3.7% to P123.9 billion in November.

Month on month, the November deficit widened from the P99.1 billion posted in October.

In the first 11 months, the fiscal deficit contracted 7.2% year on year to P1.24 trillion. The deficit was equivalent to 75% of the revised P1.7-trillion full-year deficit target.

“The wider budget deficits that led to higher outstanding National Government debt may have also led to more disciplined spending amid the need for more tax reform measures to bring down the debt-to-gross domestic product (GDP) ratio from the 17-year of 63.7% to below the international threshold of 60%,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“That may also include prudent government spending including on infrastructure to prevent the budget deficit from widening further and in turn preventing undue ballooning of the outstanding debt,” he added.

The government’s debt-to-GDP ratio stood at 63.7% at end-September.

According to the recently released Philippine Development Plan, the government aims to bring the debt ratio down to 60-62% in 2023, 57-61% in 2024, and 56-59% in 2025.

The government is aiming to bring down deficit-to-GDP ratio to 6.1% in 2023, 5.2% in 2024 and 4.1% in 2025. — Luisa Maria Jacinta C. Jocson