Gov’t spending surges by 27% in first quarter: DBM

April 25, 2018

Government spending in March reached P313.1 billion, higher by 30 percent year-on-year, sustaining the robust growth in disbursements for the first three months of the year, the Department of Budget (DBM) said Wednesday.

In total, government disbursements reached P782 billion in the first quarter of the year, higher by 27 percent from the comparable period last year.

“The outlook on government spending remains sanguine, and we expect government spending to prop up the growth prospects of the Philippine economy as we aim for economic expansion at the rate of 7 percent to 8 percent in the medium-term,” said Budget Secretary Benjamin Diokno.

Subsidy paced spending in March as it reached P35.2 billion, higher by P26.8 billion or 320% year-on-year.

This is on account of the first batch of releases for health insurance premiums of senior citizens, amounting to P15.1 billion, under the National Health Insurance Program. P4.3 billion was also downloaded for the Tax Reform Cash Project under the Land Bank for some 1.8 million CCT-beneficiary households.

Other significant items include the P3.4 billion subsidy to the National Irrigation Administration (NIA) for its irrigation projects, P1.8 billion to the National Food Authority (NFA) for its rice importation program, and P1.5 billion for power subsidy to the Subic Bay Metropolitan Authority.

Infrastructure and other capital outlays continued its upward momentum, rising by 32.4 percent year-on-year, to reach P63.4 billion in March.

This is on account of the implementation of road infrastructure projects of the Department of Public Works and Highways (DPWH), completed construction of police stations by the Department of the Interior and Local Government-Philippine National Police (DILG-PNP), and repairs and rehabilitation of school facilities as well as purchase of office supplies and furniture for various Department of Education (DepEd) schools nationwide.

Personnel services also grew by 23 percent, year-on-year, to close at P86.3 billion. The increase in the pay of both civilian, and military and uniformed personnel, the release of the 2016 Performance-Based Bonus to qualified DepEd employees, and the transfer of funds to the Development Bank of the Philippines for the salaries and allowances of poll watchers for the 2018 Sangguniang Kabataan and Barangay elections contributed to higher PS spending.

Compared to the quarterly fiscal program, actual disbursements exceeded the P755.8 billion target for the first quarter of 2018 by P26.2 billion, or 3.5 percent, mainly due to encashment of check floats and settlement of accounts payable, particularly for infrastructure projects completed in prior years.

Infrastructure spending and personnel services paced the growth in disbursements for the first quarter of the year reaching P157.1 billion (for a 34 percent increase year-on-year) and P206.6 billion (for a 23 percent increase year-on-year), respectively.

“The first quarter numbers suggest that the reforms we are implementing, in terms of budget planning and utilization, are gaining foothold,” said Diokno.

“We will not let up in our efforts to limit underspending and continue with the efficient and accountable management of public resources,” he added. DMS