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Gov’t agencies’ cash usage falls to 95% in 2020

CASH UTILIZATION by government agencies fell to 95% in 2020 from 97% a year earlier, according to the Department of Budget and Management (DBM).

Utilization fell after government projects were disrupted by the pandemic, with the so-called “catch-up plan” implemented towards the end of the year not able to bring spending rates, as measured by the use of notices of cash allocation (NCAs), to 2019 levels.

The DBM said that the National Government’s NCA utilization was P3.648 trillion out of P3.853 trillion released in that period. In 2019, it used P3.234 trillion of P3.338 trillion.

An NCA is an authorization issued by the DBM to agencies informing them of the funds available for disbursement.

In the fourth quarter, government agencies used P1.093 trillion worth of NCAs for a 97% utilization rate. This utilization rate is identical to the performance in the fourth quarter of 2019, and higher than the 96% usage rate in the third quarter of 2020.

The fourth quarter NCA utilization rate means P204.789 billion worth of NCAs was not used by government agencies at the end of 2020.

Usage rates fell towards the second half of 2020 after lockdown restrictions hampered government projects and programs.

President Rodrigo R. Duterte signed Republic Act No. 11520 on Dec. 29 extending the validity of the 2020 budget for another year, allowing the government until Dec. 31, 2021 to use the funds that were not spent last year.

Separately, the DBM issued Local Budget Circular No. 133 on Jan. 18, a copy of which was published late Tuesday, allotting P350 million for the Local Government Support Fund – Assistance to Cities.

It ordered cities that plan to seek financial support from the fund to prioritize spending on construction and rehabilitation of green open spaces and infrastructure for active mobility, including parks, botanical gardens, bicycle lanes and walkways.

Local governments were instructed to submit their requests by June 30. — Beatrice M. Laforga

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