Increase traced largely to DPWH disbursements
Disbursements by the national government on infrastructure and other capital outlays surged 23.1 percent in the first two months of 2025 from a year earlier, the Department of Budget and Management (DBM) said on Monday.
Infrastructure spending rose to P148.3 billion in January to February from P120.5 billion in the year-earlier period, the DBM said in a report.
Tracing the increase largely to disbursements by the Department of Public Works and Highways (DPWH), the DBM said the additional funds were used to complete some carryover infrastructure projects, and for payments on emergency and disaster-related civil works, right-of-way settlements, as well as higher volume of contractor billings and faster processing of accounts payables and enhanced coordination between DPWH and the implementing offices.
Other DPWH programs and projects included the construction and maintenance of roads, bridges, flood control facilities and multi-purpose buildings.
Direct payments by the development partners on progressive billings for ongoing foreign-assisted projects “helped sustain the strong infrastructure and other capital expenditure performance during the
first two months of the year,” the DBM said.
The foreign-assisted projects were recorded under the Department of Transportation, such as the North-South Commuter Extension Project, the South Commuter Railway Project, the Davao Public Transport Modernization Project, and the DPWH’s Pasig-Marikina River Channel Improvement Project,
Election season
Reinielle Matt Erece, economist at Oikonomia Advisory & Research Inc., said higher infrastructure spending can be attributed in part to the election season.
“Ensuring infrastructure projects are running well can give politicians better visibility,” he said.
“However, we can also attribute this to fiscal spending in an effort to support the country’s growth momentum amid global economic uncertainty and faltering demand, both of which drag the country’s growth forecasts,” Erece added.
Important consideration
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, said the progress and completion of more infrastructure projects at the local and national levels would be given an important consideration by voters in choosing candidates during the midterm elections on May 12.
“Definitely accelerated government spending, especially on infrastructure and other government projects as part of the preparations for the May 2025 midterm elections before the election ban,” he said, even if “there are some infrastructure projects that are exempted from the election ban.”
Accelerated government spending, especially on infrastructure, bodes well and could fundamentally contribute to faster economic growth and development, Ricafort added.
The DBM expects disbursements for March 2025 to have improved significantly as line agencies were expected to have used their remaining and fully credited cash allocations in the first quarter of the year.
Also, recipient agencies seemed to have expedited their disbursements ahead of the 45-day election ban on releasing, disbursing and spending of public funds starting March 28, the budget department said in its report.
“Spending for April 2025 is expected to temporarily slow down as the election-related prohibition might impede the implementation of some programs and projects,” the DBM said.
“Nevertheless, as observed or experienced in similar election periods, disbursements are seen to pick up strongly towards the latter part of May to June after the election ban is lifted,” it added.
Key infrastructure projects of various government agencies, as well as major health, housing, agriculture, education and labor sector programs have been exempted by the Commission on Elections from the election ban.
The commission also excused from the ban key programs of the Department of Social Welfare and Development, such as the Ayuda sa Kapos ang Kita Program, the Pantawid Pamilyang Pilipino Program, and the Assistance to Individuals in Crisis Situation.
“These exemptions will ensure the continued and unhampered delivery of public goods and services, particularly social protection programs and public infrastructure activities that are both critical to sustained poverty reduction efforts and economic recovery,” the DBM said.
eMarketplace transactions
Meanwhile, the DBM on Monday also gave an update on the transactions coursed through its eMarketplace online platform. The eMarketplace is designed to modernize the government’s procurement process, allowing agencies to “add to cart” essential goods and services for timely and cost-effective transactions.
Procurement Service-DBM Executive Director Genmaries Entredicho-Caong said in a press briefing on the sidelines of the East Asia and the Pacific International Public Procurement Conference in Pasay City there are 86 orders in the e-Marketplace, of which 15 have been delivered so far.
“The 15 translates into around P31 million of total sales, while the total orders of 86 translates to around P80 million,” Caong said.
“What we have onboard are motor vehicles. But in the coming weeks and in the coming months, those included in the pilot items are cloud computing services, airline tickets and software and licenses. Within the year, aside from the pilot items, we plan to add up ICT equipment,” she added.
The government was able to save around P10 million from the procurement of motor vehicles via the eMarketplace.
“That’s the difference between the price of motor vehicles in the eMarketplace versus the market price,” Caong said.
The eMarketplace is one of the components of the New Government Procurement Act, which modernizes and increases public procurement processes in the country by addressing existing loopholes and inefficiencies.
President Ferdinand R. Marcos Jr. signed the procurement act into law on July 20, 2024.
