<\/p>\n
By Justine Irish D. Tabile, <\/b>Senior Reporter<\/i><\/p>\n
INFRASTRUCTURE SPENDING <\/span>slumped by 48% 12 months on 12 months in March on account of lower disbursements and tighter processes within the wake of a corruption scandal involving government <\/span>projects.<\/p>\n In its latest National Government (NG) disbursement report, the Department of Budget and Management (DBM) said spending on infrastructure and other capital outlays fell to P59.1 billion in March from P113.5 billion in the identical month in 2025.<\/p>\n Month on month, infrastructure spending also declined by 11.1% from P66.4 billion in February.<\/p>\n \u201cThe decline was largely attributed to the lower disbursement performance of the Department of Public Works and Highways (DPWH) amid the continued completion of carry-over projects and implementation of the present 12 months\u2019s budget,\u201d the DBM said.<\/span><\/p>\n \u201cThe adoption of stricter validation process for billing claims to make sure project quality and value for money also continued to affect the department\u2019s spending outturn.\u201d<\/p>\n Nonetheless, the implementation of capital outlay projects under the Revised Armed Forces of the Philippines Modernization Program of the Department of National Defense helped temper the spending decline in March, it said.<\/p>\n For the primary quarter, infrastructure spending plunged by 43.5% to P147.8 billion from P261.8 billion a 12 months ago. This accounted for just 11.6% of the federal government\u2019s full-year program.<\/p>\n Under the 2026 Budget of Expenditures and Sources of Financing, NG money disbursements for infrastructure and other capital outlays are expected to achieve P1.27 trillion this 12 months. This excludes infrastructure subsidies and equities to government-owned and -controlled corporations in addition to infrastructure transfers to local government units.<\/p>\n The DBM attributed the first-quarter decline to base effects from the frontloading of projects ahead of the election ban seen in the course of the same period in 2025, the continued completion of prior-year obligations, and stricter validation and processing of billing claims.<\/p>\n It said it expects infrastructure spending to select up within the second quarter as agencies begin obligating funds from allotments released in earlier months.<\/p>\n \u201cInfrastructure departments are, likewise, expected to reap the benefits of the summer season to expedite construction activities,\u201d it said.<\/p>\n \u201cThis may hopefully construct up spending momentum and help the recovery of infrastructure spending towards the second half of the 12 months.\u201d<\/p>\n CORRUPTION MESS \u201cThe infrastructure spending slowdown is a direct results of the bureaucratic chilling effect of the flood control and pork barrel corruption scandals last 12 months,\u201d he said in a Viber message.<\/p>\n \u201cAgencies and lawmakers, who shouldn\u2019t actually have a role in spending decisions, are way more cautious out of fear of heightened scrutiny over procurement, project quality, and contractor relationships.\u201d<\/p>\n The country was embroiled in a corruption scandal last 12 months linking government officials, lawmakers, and contractors to substandard or nonexistent flood control projects. The controversy slowed government spending and dampened investor and consumer sentiment, which was reflected within the below-target gross domestic product (GDP) growth figures recorded starting within the second half of 2025.<\/span><\/p>\n The slump has endured as lingering effects of the graft mess were compounded by soaring oil prices on account of the Middle East war, causing the economy to expand by just 2.8% in the primary quarter. This was slower than the 5.4% growth in the identical quarter last 12 months and three% within the fourth quarter of 2025.<\/span><\/p>\n Mr. Africa added that \u201crising political temperature\u201d could also be contributing to project implementation delays because the administration may very well be using its control over infrastructure budgets to paralyze its political opposition.<\/p>\n \u201cThis corruption- and patronage-driven distortion of the budget process can be being aggravated by fiscal pressures rapidly bubbling to the surface,\u201d he said. \u201cNG debt has already risen to 65.2% of GDP in the primary quarter of the 12 months, which is approaching the best in 20 years, when it hit 65.7% in 2005.\u201d<\/p>\n Still, Mr. Africa said he expects spending to rebound this second quarter.<\/p>\n \u201cNonetheless, there’s little reason to expect that infrastructure spending shall be strong or sustainable enough to substantially boost aggregate growth, which has been in structural slowdown since 2017.\u201d<\/p>\n The federal government might also be forced to reallocate its resources towards fuel subsidies and other social assistance to answer the oil shock, he added.<\/p>\n \u201cIn that case, infrastructure spending could also be squeezed not only by corruption-related paralysis but in addition by a reprioritization under emerging conditions of geopolitical and oil market instability.\u201d<\/p>\n Ser Percival K. Pe\u00f1a-Reyes, a senior research fellow on the Ateneo Center for Economic Research and Development, said the sharp decline in infrastructure disbursements may very well be attributed to base effects, project completion timing, and implementation delays.<\/span><\/p>\n \u201cThe outlook for Philippine infrastructure spending within the second quarter of 2026 is for a gradual recovery, but still relatively weak overall,\u201d he said via Facebook Messenger.<\/p>\n \u201cEconomists generally expect a stronger pickup within the second half of 2026, moderately than a direct rebound within the second quarter. It’s because governance reforms and tighter anti-corruption controls following the flood control controversy have slowed project approvals and payments.\u201d<\/span><\/p>\n Nonetheless, if spending doesn’t rebound, this might weigh on the economy\u2019s prospects as public construction is among the many country\u2019s key growth drivers.<\/p>\n \u201cEconomists have warned that if infrastructure disbursements remain depressed through the second quarter, quarterly GDP growth could undershoot the federal government goal, unless consumption and exports compensate for the weakness,\u201d he said.<\/p>\n \u201cAt the identical time, some analysts note that stricter project screening and anti-corruption checks may temporarily slow growth but could improve spending eff<\/span>iciency and project quality over the long run.\u201d<\/p>\n<\/p><\/div>\n <\/p>\n","protected":false},"excerpt":{"rendered":" CONSTRUCTION of a two-tube tunnel is ongoing in Davao City. It is an element of the 45.5-kilometer Davao City Bypass Road Project. \u2014 COURTESY OF DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS By Justine Irish D. Tabile, Senior Reporter INFRASTRUCTURE SPENDING slumped by 48% 12 months on 12 months in March on account of lower disbursements […]<\/p>\n","protected":false},"author":1,"featured_media":336566,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[10853,51848,5298,3214,4874,4139],"class_list":["post-336565","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-corruption","tag-disbursements","tag-infrastructure","tag-mess","tag-slows","tag-spending"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/336565","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/comments?post=336565"}],"version-history":[{"count":2,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/336565\/revisions"}],"predecessor-version":[{"id":336568,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/posts\/336565\/revisions\/336568"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/media\/336566"}],"wp:attachment":[{"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/media?parent=336565"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/categories?post=336565"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ebiztoday.news\/index.php\/wp-json\/wp\/v2\/tags?post=336565"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
<\/b>Slower infrastructure spending <\/span>early this 12 months reflects unresolved governance issues and the increas<\/span>ingly corruption-driven nature of <\/span>the Philippine growth model, said Jose Enrique \u201cSonny\u201d A. Africa, executive director of think tank IBON Foundation.<\/span><\/p>\n