THE infrastructure spending and other capital outlays of the government in April 2017 declined 21 percent to P33.5 billion from P42.5 billion a year ago, data from the Department of Budget and Management over the weekend show.
The April figure was also 30 percent than the P47.9 billion actual infrastructure spending and other capital outlays in March 2017. Despite the April decline, infra and other capital outlays in the first four months were still up 2.6 percent to P151 billion from P147.2 billion in the same period last year.
“This is largely on account of the absence of big-ticket capital expenditures in the DND-AFPMP such as the purchase of FA-50 aircraft and anti-submarine helicopters which contributed to around P3.7 billion disbursements for the same month in the 2016,” the DBM said in a statement.
“Likewise, disbursements of the DPWH were lower year- on-year. As explained earlier, the acceleration of implementation and completion of capital outlay projects prior the conduct of elections resulted to high disbursements in the DPWH in April 2016. For this year, however, implementation of projects under its road network services which include road widening, repair and rehabilitation, and flood control projects, among others are still underway,” the DBM said.
The agency said the growth of disbursements was expected to normalize in the coming months after the moderate out-turns early this year, partly because of the effect of election spending. It said the spending trend this year was similar to that of 2015 where growth was low during the first four months but gradually picked up toward the latter part of the second quarter, before maintaining a two-digit expansion up to the end of the year.
“… The programming of big-ticket expenditures in the second semester… as well as the grant of mid- year bonus this May and the payments for completed Asean activities could lead to higher spending growth in the coming months,” the DBM said.
The government last week reported that it posted posted a fiscal surplus of P52.8 billion in April, a reversal of the deficit of P61.5 billion a month ago, as expenditures declined 4 percent to P183.1 billion from P191.6 billion a year ago. The April surplus was, however, 4 percent lower than the P55-billion surplus in the same month last year.
ING Bank Manila senior economist Joey Cuyegkeng said in a comment a slower pace of spending performance in the second quarter would result in a slower economic growth in the April-to-June period. The economy grew 7 percent in the second quarter of 2016.
“Base effects would remain negative in the second quarter of 2017—especially April and May. June 2016 spending growth dropped YoY. The 2Q 2016 headline and core spending growth rates slowed to 11 percent and 13 percent, respectively, from 1Q 2016 headline and core spending growth rates of 17.4 percent and 21.3 percent,” Cuyegkeng said.