The government on Monday released at least 90 percent of the 2016 appropriations for all agencies, the Budget department said.
In value terms, this is equivalent to P1.49 trillion of the total P1.66 trillion allotted under the P3.002-trillion national budget for this year, the department added.
Once approved and in effect, all disaggregated items in the budgets of all agencies are deemed effectively released, it explained.
“Together with the earlier policy adopted, which authorized departments and agencies to advance pre-procurement activities that enable them to bid projects short-of-award, this policy will further accelerate the already much improved pace of government spending,” Budget Secretary Florencio Abad said in a statement.
“It will also ensure that most projects will be implemented before the beginning of the election ban on March 25,” he added.
Abad also said the comprehensive release under the GAA-as-Release Document (GAARD) regime would not only promote faster implementation of programs and projects but also sustain growth momentum from 2015.
“While government underspending is a recurrent problem due to institutional weaknesses in agencies for the most part, the GAARD regime gives these agencies a head-start in their procurement activities and gives them much-needed momentum in terms of higher rates of obligation. This results in faster delivery of public goods and services, which will be to the benefit of our people,” he said.
Abad said infrastructure projects, in particular, are expected to be accelerated with the Department of Public Works and Highways (DPWH) targeting an obligation rate of 50 percent within the first quarter of the year.
“We can expect 50 percent of infrastructure projects under the DPWH to be issued notices of award by the first quarter of 2016. This amounts to almost P187.86 billion and is higher than their actual obligation rate of 39 percent, or P111.14 billion, within the same period last year,” he said.
The department noted that the government was poised to complete key infrastructure projects this year, including 98 percent of 364,693 lineal meters of bridges and 85 percent of 32,526.50 kilometers of roads.
It claimed that the government had significantly increased total infrastructure spending over the last five years, from P175.4 billion in 2011 or 1.8 percent of gross domestic product (GDP) to P766.5 billion this year to achieve the international benchmark of 5 percent of GDP.
Abad said the increase in spending would be complemented by encouraging public-private partnerships, improving governance to curb corruption, climate-proofing facilities and improving procurement.
He was optimistic that economic growth momentum would continue from the fourth quarter of 2015, which he predicted would be better compared to the three previous quarters.
“December 2015 spending will continue the momentum that the previous five months demonstrated. In addition, the spending boost for last-minute Christmas sales will further ramp up growth in the last month of the year,” Abad said.
Expected growth drivers in the first semester of 2016 are the following:
• issuances of notices of award and notices to proceed for projects that benefited from pre-procurement activities in the second semester of 2015;
• a “great sense of urgency” to implement projects before the March 25 election ban;
• an additional consumption push due to the January 1 effectivity of the Salary Standardization Law of 2015;
• spending in the run-up to, during, and after the May local and national elections; and
• a further spending boost from preparations for the opening of classes in June.