Gov’t infra spending increases 28% in May

Government infrastructure spending and other capital outlay increased by more than a quarter in May this year, data from the Department of Budget and Management (DBM) showed.

During the month, infrastructure spending and other capital outlay improved by 28.5 percent to billion from billion in the same month last year, DBM data showed.

Budget Secretary Florencio B. Abad said the robust growth was driven by better agency performance from the Departments of Public Works and Highways (DPWH).

In the first five months of the year, infrastructure spending and other capital outlay also increased by 3.1 percent to billion from billion in the same period in 2014.

Abad also noted the better disbursement performance from other agencies, including the Departments of the Interior and Local Government (DILG), Social Welfare and Development (DSWD), Finance (DOF), and the Office of the President (OP).

“Faster utilization of notices of cash allocation (NCAs) in May 2015 – up by 7.9 percentage points compared to 2014 – drove total cash disbursements up by 14.7 percent,” Abad said.

He added latest report from the DBM shows continuing year-on-year improvement in national government disbursements, with capital outlay and maintenance and other operating expenditures increasing by 20 percent in May compared to the same month in 2014.

Total year-on-year spending in May also picked up by 9.2 percent, from

billion in 2014 to billion. “We have been actively implementing measures to address the spending shortfall, and we will continue to pursue solutions that will ensure quicker spending. The latest data, which shows that key agencies are stepping up, is an encouraging sign,” Abad said.

“However, agencies must continue to optimize their fund releases. The government’s fulfillment of its spending targets will rely largely on whether agencies will make swift, efficient use of their budgets,” he added.

Government expenditures for the first five months of 2015 also outpaced 2014 figures by billion or 6.2 percent.

The DBM report likewise noted that non-NCA spending contracted in May, due to decreases in tax expenditure subsidies, net lending, and interest payments. These contractions, while lowering total spending, reflect prudent expenditure management by the national government.

We encourage agencies to continue improving their performance in the coming months so that they can meet their target outputs. If they do this, they will also succeed in providing prompt and timely services to the public,” Abad said.

“Our ultimate goal has always been sustained, inclusive growth, and good spending performance will go a long way towards achieving that for our people,” he added.

The report predicted continued acceleration in the coming months, particularly in June, with the release of funds to cover the payment of the Productivity Enhancement Incentive (PEI) to government employees, and the premium subsidy of indigent families covered by the National Health Insurance Program.