Economic managers lay down spending catch-up plan

by Mary Grace Padin (The Philippine Star), May 25, 2019

MANILA, Philippines — The Duterte Cabinet’s Economic Development Cluster (EDC) remains confident that the government would be able to meet its spending target for 2019 as line agencies laid out their respective “catch up” plans for the rest of the year, according to the Department of Finance.

In a meeting held at the DOF yesterday, members of the EDC prepared a catch-up plan that would enable the government to offset its lower spending performance in the past months, which was due to the delay in the budget and the election ban on public works.

“The members of the Economic Development Cluster held a meeting to formulate a carefully crafted and bold expenditure catch-up plan to enable us to hit a GDP growth rate of above six percent this year. Key infrastructure agencies presented their updated spending plans for this year,” Finance Secretary Carlos Dominguez said in a press briefing after the meeting.

Under the plan, Dominguez said key agencies, particularly the Department of Public Works and Highways (DPWH) and the Department of Transportation (DOTr), have committed to speed up the implementation of their projects for the rest of the year.

He said the spending goals of the two agencies would be major contributors in helping the government achieve its expenditure program for 2019.

“The spending commitment of our two main infrastructure agencies, with an estimated combined amount of P803.1 billion, is enough to cover the national government’s infrastructure target,” Dominguez said.

For the two agencies to deliver their respective commitments, Dominguez said they would need to closely cooperate with other agencies for the faster approval and release of permits and other requirements.

He said that other agencies, including the Department of National Defense, Department of Education, and the Department of Health, would also help in driving spending growth for this year.

“It was also agreed that the government will fast track the implementation of its priority socioeconomic programs, such as the National ID System, 4Ps (Pantawid Pamilyang Pilipino Program), social pension, unconditional cash transfers, and fuel marking program,” he said.

However, the finance chief said the catch up plans would also be hinged on weather conditions in the latter part of the year.

“As I have said all the time, the weather is going to play a large part here and we just hope that the weather conditions remain favorable for large outdoor infrastructure projects,” he said.

The government has a disbursement program of P3.774 trillion for 2019.

In the first quarter of the year, actual government spending reached P778 billion, only 0.8 percent up from the P772 billion recorded in the same period last year.

Economic managers estimate that underspending amounted to P1 billion a day, or as much as P90 billion during the period, due to the delay in the passage of the 2019 budget.

As a result, Philippine economic growth slowed down to a four-year low of 5.6 percent in the first quarter.

To meet the disbursement target and to propel economic growth for the rest of the year, Dominguez said the government must spend around P2.996 trillion from the second to fourth quarters of the year.

Infrastructure spending must also reach P792.97 billion during the April to December period for the government to meet the P1 trillion infrastructure outlay target for 2019.