The Marcos administration’s much-awaited second-half pickup in infrastructure spending got off to a weak start in July as the Department of Public Works and Highways (DPWH) continued to weigh on overall expenditures. However, the downturn eased considerably from previous months.
In July, the decline in infrastructure spending finally limited itself to single digits, after it had fallen by more than 30 percent in every month from January to June.
Latest data from the Department of Budget and Management (DBM) showed infrastructure and other capital outlays slipped 4 percent to P89.6 billion in July from P93.3 billion in the same month last year.
From January to July, infrastructure spending fell 36 percent to P457 billion from P713.5 billion a year earlier.
‘The lower level reflected, among others, lower DPWH disbursements amid strengthened procurement compliance, monitoring of ongoing projects, and review and validation of payment claims and contractor documentation,’ the DBM said.
‘Infrastructure implementation nevertheless continued across other key sectors, including defense modernization, rail and mass transport, school facilities, and agricultural infrastructure,’ it added.
Projects that eased the July decline included the Armed Forces Modernization Program, Rural Development Projects, and rail transport accounts payable settlements.
Total government spending, meanwhile, improved after climbing nearly 20 percent to P588.6 billion in July from P491.2 billion a year earlier, while cumulative spending also rose 7 percent to P3.763 trillion from P3.516 trillion.
The government’s economic managers are relying on increased infrastructure spending in the second half to improve the disappointing 2.6 percent growth in the first half.
Earlier, DBM Secretary Kim Robert de Leon said they were expecting the DPWH to start implementing projects in August and September.
Socioeconomic Planning Secretary Arsenio Balisacan, meanwhile, expects a fourth-quarter recovery in spending, adding that they needed to bring public construction back to at least zero growth instead of a contraction to add about 1 percentage point to gross domestic product.