Gov’t to ramp up spending

THE Department of Budget is ramping up efforts to address the issue of underspending on public infrastructure ahead of next year’s elections.

This early, DBM Assistant Secretary Tanya Hamada said her department has asked concerned government agencies and local governments to prepare their detailed budget estimates for projects to be included in the 2016 national expenditure program.

Hamada said these documents include the detailed engineering design, program of work and cost estimates required for project bidding.

“It [2016] is an election year. For the first quarter, [project] implementation will kick-off because of the election ban by March,” she said in an interview on the sidelines of the Kapihan sa Media ng Bayan on Friday.

Once the proposed P3.002-trillion national budget for 2016 is approved, Hamada said the process only involves bidding and award of projects in January before the infrastructure ban.

“[With this,] I don’t think we will have [another] low first-quarter GDP [gross domestic product],” she said.

The government underspending on public infrastructure has been blamed on weaker growth of the economy in January to March this year.

The country’s second-quarter GDP expanded to 5.6 percent from 5 percent the previous quarter as strong government spending helped bolster economic expansion.

To address the issue of underspending, Hamada said the department is also strengthening the capacities of the local governments in project planning and budgeting.

“For example, for health stations and classrooms, local governments know which areas [these projects] are really needed,” she reasoned.

Hamada further said her agency will also hasten disbursements.

She explained that once the General Appropriations Act is passed, concerned agencies no longer need DBM-issued Special Allotment Release Order for regular programs they undertake.

The DBM had earlier said the national government’s infrastructure spending rose 93 percent in July but it is still below target.

Budget Secretary Florencio Abad said infrastructure and capital outlays surged to P38.3 billion in July from P19.9 billion year-on-year.

The figure, however, was still 17 percent short of the national government’s target of P45.98 billion for infrastructure spending in July.

Abad attributed the increase in infrastructure spending to the faster disbursement by the Public Works Department spending under the Armed Forces of the Philippines Modernization Program.

Abad said health spending should also be accelerated.

Infrastructure spending in the first seven months of 2015 increased 22 percent to P245.65 billion from P202.87 billion on year.

“What this really means is that our leading agencies for infrastructure programs are making better use of their budgets. As a result, more goods and services are being rolled out to the public, and in better time,” Abad said.

Meanwhile, spending on personal services rose 9 percent to P46.5 billion and while that of maintenance and other operating expenses surged 70 percent to P36.6 billion mainly due to the conditional cast transfer program of the Social Welfare Department.

Interest payments rose 10 percent to P53.1 billion July, which according to Abad, showed the ability of the government to pay debts.

Abad said “better figures” were expected for the rest of the year, driven by the start of the election ban period in February.

“I have a feeling that August is going to be another good month all the way to the end of the year,” he said.

He said interventions like improvement in the procurement process and the election period would boost public spending.

“People now realize that it will not be wise to carry over projects because election ban starts in February, [then] they [projects] should be obligated and on-going.

The government’s budget deficit widened to P32.2 billion in July, as tax and customs collections fell and public expenditures jumped the most in a year.

Data from the Finance Department showed the budget deficit in July eclipsed the P1.76-billion shortfall recorded in the same month last year but was still 54 percent short of the government’s deficit target of P69.43 billion for the month.

The figure brought the budget deficit in the first seven months to P18.5 billion, or 67 percent lower than the P55.74-billion gap recorded in the same period last year and 92 percent short of the P224.51-billion target for the seven-month period.

Revenues in July grew just 7 percent to P178.5 billion on lower collections by the Bureau of Internal Revenue and Bureau of Customs, while expenditures jumped 25 percent to P210.7 billion.

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