Govt infra, capital spending up 17.8%

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Infrastructure and other capital spending climbed in October, the Budget department reported on Wednesday, with government resources having been used for priority public works, transport and communications projects.
Data released by the department put spending at P51.5 billion during the month, up 17.8 percent compared with the P43.7 billion recorded a year earlier.

Year to date, expenditures grew 11.8 percent to P442.7 billion from P395.8 billion in the corresponding period last year.

The Budget department attributed the increase to payments for completed projects under the Public Works department, including those for road repair, upgrading and widening, and flood control and rehabilitation or improvements to dike systems.

The rise was also traced to the Local Government department and the Philippine National Police’s Capability Enhancement Program and payments for various communication, navigational and air traffic management system projects as well as consultancy and civil works for the Light Rail Transit Lines 1 and 2 extension projects of the Transportation department.


The Budget department said disbursements for the first 10 months of the year were for the implementation of road infrastructure programs, the modernization and capability enhancement of the armed forces and the national police, the repair and rehabilitation of school facilities and the acquisition of health facilities and medical equipment.

“While the growth rates are by no means exhibit a ‘golden age’ expansion, we consider the figures encouraging and hopefully enough to boost the contribution of public sector outlays in fourth quarter GDP (gross domestic product), which had slowed considerably in the first three quarters of the year,” Bank of the Philippine Islands Vice-President and lead economist Emilio Neri Jr. said.

“We also hope this provides adequate momentum for 2018 infra spending to reach ‘golden age’ proportions,” he added.

IHS Markit chief economist Rajiv Biswas said the strong October upturn compared with a year ago highlighted that government plans to boost infrastructure development were being implemented.

“The Duterte administration’s ‘Build Build Build’ infrastructure plan aims to ramp up infrastructure development over the next five years to boost the competitiveness of the Philippines,” he noted.

“Poor infrastructure in the Philippines is a competitive disadvantage for the nation and deters foreign direct investment.”

The Duterte administration earlier this year identified 75 projects to be prioritized under the “Build Build Build” program, paving the way for a “Golden Age of Infrastructure”.

The projects will be backed by a budget that could reach P8 to P9 trillion over the duration of the government’s six-year term. The Budget department earlier reported that national government spending grew by 28.2 percent in October to P226.9 billion.

“This is highest growth recorded so far this year, following the 20.4 percent and 22.6 percent posted for the months of May and June, respectively,” it said.

It brought cumulative disbursements to P2.24 trillion, up 10 percent from the comparable 2016 period.

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