STATE EXPENDITURE on infrastructureThe structure rose 16.9% in September, fueled by payoutsfor finished transport projects, according to the Ministry of Budget and Management (DBM).
In the National Government’s latest disbursement report, spending on infrastructure and other capital expenditures increased by P19.8 billion to P137.1 billion in September, compared to P117.3 billion in the same month last year.
Month-on-month, infrastructure spending rose 26.24% from P108.6 billion in August.
The DBM attributed the increase in September disbursements to the payment for completed road network and bridge programs of the Department of Public Works and Highways (DPWH).
Higher disbursements were also made for several foreign-backed projects of the Ministry of Transport.
It also noted capital expenditures for local requirements for the implementation of the Metro Manila Subway Project Phase 1, the North-South Commuter Railway System and the Davao Public Transport Modernization Project.
Funds were also used for the Armed Forces of the Philippines Modernization Program of the Department of National Defense (DND), as well as for the construction and repair of courtrooms across the country and the implementation of the Department of Education’s computerization program.
From January to September, infrastructure spending rose 14.6% to P982.4 billion from P857.6 billion in the same period in 2023.
“The robust spending growth over the period was largely attributed to infrastructure and other capital expenditures, with significant disbursements recorded by the DPWH for its flagship infrastructure projects and the DND for its defense modernization projects,” the DBM said.
Total infrastructure spending, which includes transfers to local government units and subsidies to government-owned and controlled companies, rose 12% to £1.14 trillion at the end of September.
“This equated to 6.1% of GDP (gross domestic product) compared to the 5.9% of results for the same period last year and the full-year target of 5.6% this year,” it said. the report.
Philip Arnold “Randy” P. Tuaño, dean of the Ateneo School of Government, said the increase in infrastructure spending is likely to continue in the near term.
“(The increase was) due to significant balancing from various budget sources that remain available for release, and the prioritization of large-scale transportation projects such as the Metro Manila Subway,” Mr. Tuaño said in an email this weekend. .
He also expects an increase in infrastructure spending as the 2025 midterm elections are five months away.
“First, it should be noted that infrastructure spending has been increasing year over year, and this will increase even further as we move into the 2025 national budget,” said Terry L. Ridon, a public investment analyst and president of the think tank InfraWatch PH, in a Viber message. . “This is the underlying reason for spending improvements this year.”
The government’s infrastructure program for this year is set at £1.472 trillion, equivalent to 5.6% of GDP.
Mr. Ridon urged infrastructure agencies to improve absorption capacity “especially since 2025 is an election year in which the law requires a suspension of project implementation for a specific period.”
“The challenges are that the rate of absorption and combustion by our major agencies, especially in infrastructure and agriculture, has been quite low,” former National Economic and Development Authority Secretary Cielito F. Habito said at a conference at the University of the Philippines School. Economy on Friday.
Mr Habito noted that there have been “questionable priorities” in terms of allocations and use in some sectors.
“We allocate a lot of budget, but it turns out that it cannot be spent within the period for which it was intended,” he said in mixed English and Filipino.
“This is a very important issue in our fiscal policy in general. It is not so much about fiscal policy, but about the implementation of fiscal policy in that sense.”
Mr. Habito also cited DPWH’s tendency to “re-block” roads, calling it an “apparent misplacement of budgets.”
He also said the government needs more public-private partnership projects given the shortage of public funds. — Aubrey Rose A. Inosante