STATE infrastructure spending jumped by 31.3 percent year-on-year to P895.1 billion in 2021 driven by lower base effects and easing of quarantine restrictions.
Latest data from the Department of Budget and Management (DBM) showed government infrastructure spending last year rose by P213.5 billion from P681.5 billion in 2020.
The amount spent by the national government on infrastructure and other capital outlays last year was also above the P761.2 billion program for the year by 17.6 percent.
The DBM attributed the “significant expansion” in infrastructure and other capital outlays to the combined effects of lower base in 2020 with the discontinuation of some capital outlay projects which can no longer be implemented or completed due to the pandemic in line with Bayanihan 1 and 2.
Also identified as a spending driver is the implementation of various infrastructure projects of the Department of Public Works and Highways (DPWH) and the aviation and rail transport foreign-assisted projects of the Department of Transportation (DOTr).
Higher infrastructure spending and personnel services expenditures last year also drove the 10.6-percent growth in overall government spending to P4.68 trillion from P4.23 trillion in the previous year.
For December alone, government infrastructure spending inched up by 1.5 percent to P134.7 billion from P132.7 billion in the same month in 2020 given the releases for the Revised AFP Modernization Program (RAFPMP) of the Department of National Defense and the construction of Smart Campuses in Marawi.
However, the DBM said the growth in infrastructure spending for the month was partly trimmed by the timing of direct payments made by development partners for the foreign-assisted projects of the DOTr.
For this year, the government programmed to spend P1.27 trillion or 5.9 percent of the country’s GDP.
Under the 2022 national budget, the DPWH and DOTr have P786.6 billion and P75.8 billion, respectively, to accelerate the Duterte administration’s infrastructure flagship projects under the Build, Build, Build.
In view of the Comelec election ban on the construction of public works, the DBM said the government has taken the necessary steps to minimize potential disruptions.
“Relatedly, in anticipation of the said election-related prohibition, the DPWH has filed for exemption of 18 projects from the election ban,” the DBM said in its report. “Meanwhile, the DSWD also requested for exemption from the election ban to be able to proceed with relief distribution and other important programs being implemented, especially for those hit by Typhoon Odette in December 2021,” it said.
Overall government spending this year is expected to reach P4.95 trillion, up by 6 percent compared to the previous year, the DBM said.
Despite the expected lower growth in overall government spending this year compared to the previous years, the DBM said the current budget priorities reflect the government’s strong commitment to the economy’s recovery.
“While the growth of disbursements this year is lower when compared to last year’s 10.6 percent and 2020’s 11.3 percent as the government spent heavily on Covid-19 emergency and recovery measures in the past years, the commitment to sustain the growth momentum remains, as depicted in this year’s budget priorities and the strategy to safely reopen the economy, even as the government begins to consolidate fiscally,” it said.