INFRASTRUCTURE SPENDING continued to decline in October as the delayed passage of this year’s budget took a toll on disbursements, officials said.
Citing preliminary data, Budget Undersecretary Laura B. Pascua said on Friday that spending on infrastructure and other capital outlays stood at P82.2 billion in October.
The October figure was 12.92% lower from the P94.4 billion posted in the same month last year, and a reversal from the 53.9% year-on-year surge in September to P100.3 billion.
However, Ms. Pascua said the department is still finalizing the disbursement report for October and will be up on their website soon.
In the 10 months to October, infrastructure spending still lagged as it was lower by 5.5% year-on-year at P628.5 billion, accounting for just 73% of the full-year disbursement program of P859.5 billion, Finance Secretary Carlos G. Dominguez III told reporters on Wednesday evening.
Mr. Dominguez, who also heads the administration’s economic team, said the contraction in infrastructure spending during the period was “mainly due to the delay of the passage of the 2019 national budget and election ban.”
However, he said officials of the two primary infrastructure agencies assured the economic team that they will reach the full-year target.
Mr. Dominguez said the Department of Public Works and Highways (DPWH) vowed to reach its P725-billion disbursement target for the year.
He said the DPWH has spent P503.4 billion as of end-October, which accounted for 69% of its full-year target worth P725 billion.
“Secretary Mark Villar assured that the remaining P221.6 billion target disbursements for the last two months of this year is attainable,” he said.
For the Department of Transportation (DoTr), Mr. Dominguez said the agency used 57% of its full-year disbursement program at P46.82 billion from January to Nov. 28. DoTr posted its “highest rate ever achieved” in terms of actual disbursement.
“The other big spending departments such as the Department of Education, Department of Social Welfare and Development, among others, also committed to accelerate their disbursements in the remaining two months of the year,” he added.
GDP TARGET ‘ON TRACK’
Meanwhile, the Finance chief remained positive that the country can hit the low end of its 6-7% full year target for gross domestic product growth (GDP) as the government continues its catch-up spending plan, and on the back of robust public consumption buoyed by easing inflation.
“I’ve always maintained that we believe that most likely hit the lower end of our 6-7% target and it looks like our continuous monitoring of projects and removal of the bottlenecks is paying off and that I think, especially the two big infrastructure departments are doing their utmost and quite achieving a good percentage of their target,” he said.
With only a month left before the year ends, he said the economic team “remains optimistic that the economy will expand at a higher clip” as government agencies accelerate on the implementation of infrastructure development program as well as the continued investment for human capital development.
“Overall, we remain on track to reach our GDP growth target of 6 to 7 percent in 2019,” he said.
The economy expanded at a faster-than-expected clip in the third quarter at 6.2%, picking up from the muted 5.5% average growth in the first half and also higher from the six percent GDP growth in the third quarter last year.
The muted growth in the first half was largely attributed to the delayed passage of the 2019 budget which left projects unfunded, coupled with the 45-day ban on public works ahead of the mid-term elections last May.
For next year, Mr. Dominguez said the swift passage of the P4.1-trillion budget will provide the economy more room for faster expansion and a higher chance to hit the 6.5-7.5% GDP growth target for the year.
Last Wednesday, the Senate approved on third and final reading its version of the 2020 budget while the House of Representatives approved the budget plan last Sept. 20.
“I trust this bicam to go quite quickly. So we’re very confident that by the end of the year, we’ll have our full year budget approved for next year,” he said.
The 18th Congress’s bicameral conference committee held its first meeting on the proposed budget on Friday.
“That will help greatly but you know, it’s not only the budget that’s important, it’s what happens outside the country and so far, although there are good reports about this trade war getting resolved, that’s good news. I’m just not sure if those reports are accurate,” Mr. Dominguez added. — Beatrice M. Laforga