Construction workers rest on a sidewalk at the Tagaytay City Sports Park in Tagaytay City. — PHILIPPINE STAR/EDD GUMBAN

THE CASH utilization rate of government agencies reached 98% at the end of the first quarter, the Department of Budget and Management (DBM) said on Wednesday.

Data from the DBM showed that the National Government, local governments and state-owned companies used 98% or P835.5 billion of the P852.79 billion in notice of cash allocation issued in January to March.

This was slightly lower than the usage rate of 99% a year earlier.

At the end of March, the remaining unused allocations totaled P17.29 billion.

Notice of cash allocations  are a quarterly disbursement authority that the DBM issues to agencies, allowing them to withdraw funds from the Bureau of the Treasury to support their spending needs.

“This may have to do with the early approval of the 2023 national budget, as well as the further reopening of the economy towards greater normalcy with no more large lockdowns since 2022 and as a policy priority going forward,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

President Ferdinand R. Marcos, Jr. signed the P5.286-trillion 2023 national budget on Dec. 16, 2022. This was the “fastest and earliest date that a national budget had been signed,” according to the DBM.

“Agencies are aggressive in spending due to less constraints and greater avenues for productive spending,” John Paolo R. Rivera, an economist at the Asian Institute of Management, said in a Viber message.

Mr. Ricafort noted rising prices and financing costs might have led to the increased funding requirements of the government.

In March, the government said it would allot P9.3 billion for a two-month subsidy for more than nine million poor households to help mitigate the impact of inflation.

The last payout of the government’s targeted earlier cash transfer program ended in January. The program provided P18.3 billion in subsidies to about 9.2 million beneficiaries.

Inflation averaged 8.3% in the first quarter, still above the central bank’s 6% full-year forecast and 2-4% target.

As of March, line departments used P567 billion or 97% of their allotments, leaving P17.29 billion unused.

The Budget, Education, Energy, Environment, Foreign Affairs, Health, Interior and Local Government, Labor, Public Works, Science and Technology, Trade and Transportation departments all posted a budget usage rate of 100%.

Also at 100% were the Office of the Press Secretary, Joint Legislative-Executive Councils, Commission on Audit, Commission on Elections, Office of the Ombudsman and Commission on Human Rights.

The Department of Migrant Workers had the lowest usage rate of 48% as of March.

Meanwhile, budgetary support to government-owned companies as well as allotments to local government units were also fully used.

Budget Secretary Amenah F. Pangandaman earlier said that the DBM would slash the budgets of agencies with a low use rate.

“We have released most of the budget. Hopefully (utilization) is ongoing, all the procurement procedures, so they will be able to implement [these]. Especially in the infrastructure sector, I’ve released everything, so they can procure,” she said in a roundtable briefing with BusinessWorld editors and reporters last week.

“Some agencies have already come up to me because they saw their Tier 1, there were deductions because of their (low) utilization,” she added.

The DBM released P4.31 trillion or 81.9% of the P5.286-trillion 2023 national budget at the end of March. This was slightly faster than last year when the DBM had released P3.48 trillion or 69.4% of the P5.02-trillion budget as of the end of the first quarter. — Luisa Maria Jacinta C. Jocson