Infra spending up in May despite election ban

GOVERNMENT infrastruc-ture spending in May grew by 2.1 percent year-on-year to P80.5 billion despite the ban on public works for the na-tional elections.

Latest data from the Depart-ment of Budget and Management (DBM) showed government spend-ing for infrastructure and other capital outlays during the month was higher by P1.7 billion than the P78.9 billion recorded in May 2021.

The increase in state infra-structure spending was mainly attributed to the payments for the Malolos-Clark Railway Proj-ect and Phase 1 of the Metro Ma-nila Subway Project as well as the capital outlay projects under the military’s modernization program, the DBM said.

However, this was partly off-set by lower disbursements due to the 45-day ban this year on pub-lic works as well as other one-off capital expenditures, including the construction of the Senate building.

Under the rules of the Commis-sion on Elections, public officials or employees, including barangay officials and those of government-owned or -controlled corporations (GOCC) and their subsidiaries, cannot release, disburse or expend public funds for any and all kinds of public works during the period of 45 days prior to a regular elec-tion and 30 days before a special election.

The 45-day ban for public works took effect from March 25 to May 8 this year.

Meanwhile, total government spending in May slid by 1.1 per-cent or P5 billion to P451.7 bil-lion from P456.7 billion last year mainly due to the timing of P36.5-billion subsidy releases to Philip-pine Health Insurance Corp. for the payment of health insurance premiums of senior citizens in May last year.

Despite this, state infrastruc-ture spending from January to May hit P334.6 billion, inching up by 0.7 percent or P2.3 billion from P332.3 billion in the same period last year. In the same period, infrastruc-ture disbursements, which include infrastructure components of subsidy and equity to GOCCs and transfers to local government units (LGUs), also climbed by 3.1 percent year-on-year to P434.5 billion from P421.5 billion.

Overall government spending as of end-May also rose by 4.7 per-cent or P84.9 billion year-on-year to P1.896 trillion from P1.811 trillion on the back of increases in several expense items, including the higher National Tax Allotment (NTA) of local government units (LGUs) and the annual block grant of the Bangsamoro Autonomous Region in Muslim Mindanao.

Moving forward, the DBM said it expects overall government spending to rebound next month from the slight contraction recorded in May as the ban on public works and certain type of disbursements has already ended.

Total government spending likely grew by at least 20 percent year-on-year driven by subsidy releases, growth of NTA, and faster capital outlay disbursements, the DBM said, citing preliminary data.

“For the remainder of the year, further releases are anticipated with the submission of special budget requests by line agencies to implement their respective programs, activities, and projects as the government also transitions under the new administration. These are expected to accelerate the pace of government spending for the year,” it said.

For this year, the government has set an infrastructure spending program amounting to almost P1.2 trillion, equivalent to 5.5 percent of GDP.

The new economic managers committed to allocate 5 to 6 percent of GDP for state infrastructure spending under the six-year term of President Ferdinand R. Marcos Jr.