Infra spending up 35.6%, surges to P104.6B as of May

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Government spending for infrastructure as of May surged to P104.6 billion, or an increment of 35.6 percent year-on-year, the Department of Budget and Management (DBM) reported on Tuesday.

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The DBM noted that May infrastructure spending was higher compared to the P77.1 billion recorded in the same period in 2012.

Budget and Management Secretary Florencio Abad cited the government’s program budgeting initiative as a main catalyst for consistent improvements in the country’s expenditure levels.

“This brings total disbursements to P751.2 billion as of May, 12.4 percent higher than year-on-year levels tracked in 2012,” he added.

Furthermore, the agency noted that expenditures for the period also exceeded the 8.1-percent growth average for January to May disbursements observed since 2005.

Capital outlay (CO) spending grew to P104.6 billion, P27.5 billion or 35.6 percent higher than the comparable 2012 level.

The DBM explained that more than half of the total disbursement for CO is attributed to the P60 billion in payments made by the Department of Public Works and Highways (DPWH) to suppliers/contractors for various public infrastructure projects.

“The implementation of program budgeting helped bring a more deliberate and strategic approach to spending, so that expenditures are closely aligned with President [Benigno] Aquino[3rd]’s campaign for long-term, inclusive growth. Key to that is ensuring swift disbursements to high-impact sectors—such as public infrastructure and capital outlay—and other crucial industries that will deliver immediate benefits to Filipinos and allow us to sustain the country’s strong economic momentum,” Abad said.

Meanwhile, maintenance and other operating expenditures (MOOE) went up by P24.2 billion or 25.1 percent to P120.2 billion.

The DBM said that the increase MOOE contributed to spending growth for the period, mostly because of bigger expenditures devoted to the government’s banner social protection under the Department of Social Welfare and Development (DSWD), and the branding campaign program under the Department of Tourism (DOT), as well as expenses made to cover the 2013 National and Local Elections.

On the other hand, the agency said that personnel services rose by P25.8 billion or 12.2 percent year-on-year because of the annualized salary adjustments as a result of the implementation of the Salary Standardization Law III, as well as claims for retirement gratuity and terminal leave benefits.

Interest payments (IP) also increased by P7.7 billion or 5.9 percent on account of IP to domestic borrowings, in addition to interests to bonds issued in the first quarter of the year.

Abad said that the country’s spending performance to date will act as a solid base for growth in the second semester of the year, as the government eyes more focused and accelerated disbursements.

“We are working actively with our Account Management Teams in key implementing agencies to sustain and further improve the pace of disbursements, as well as to eliminate expenditure bottlenecks that might prevent our agencies from making the most of their fund releases,” he added.

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