HOUSE TO 'LOP OFF SOME FAT' IN 2004 BUDGET

MANILA, OCTOBER 14, 2003  (STAR) Congressmen are expected to "lop off some fat" from the proposed P864.8 billion national budget for next year.

Camarines Sur. Rep. Rolando Andaya Jr. said falling revenues are the "greatest challenge" facing lawmakers as they prepare a budget to meet the needs of 82 million Filipinos.

"Sculpt is the right term, not liposuction because the latter connotes a procedure done on something big and the national budget is far from one," he said.

Andaya, chairman of the House appropriations committee, said poor tax collections have forced the government to draw up a small budget.

"(Congressmen would) do some nip-and-tuck on the budget, lopping off some fat on some areas, and adding muscle on skinny parts," he said.

Andaya said "a gap of around" P14.3 billion in tax collections will push up next year’s deficit to P212.1 billion from the P197.8 billion predicted by economic managers.

"The administration believes the GDP (gross domestic product) will grow by 4.9 percent to 5.8 percent in 2004, but our forecast is 4.2 percent," he said.

"They have factored in as income P14 billion from still proposed revenue measures, we are cautioning them not to count their chicks before they’re hatched," he said.

Andaya said the percentage of GDP collected as taxes next year will be at 12.6 percent, one of the lowest in the region because of the annual "tax leakage" of at least P140 billion.

"To finance the P864.8-billion budget, the government will resort to gross borrowings of P411.7 billion, of which P270.7 billion will be used to settle maturing debts," he said.

"P286.4 billion or 33 percent of next year’s budget will go to personal services; P506.3 billion or 59 percent will go to maintenance and other operating services (MOOE); and P70.1 billion or eight percent will go to capital outlays."

Andaya said P271.5 billion of MOOE funds is deemed automatically appropriated for interest payments for the government’s P3.2 trillion debts, and P1.3 billion for retirement and insurance premiums.

"The government will follow a 70 domestic-30 percent foreign borrowing mix next year," he said.

Andaya said the proposed budget provides for the hiring of 10,000 teachers — costing P1 billion annually — and seeks to allot P3 billion for new classrooms.

"It seeks to add P600 million for operations of schools as well as P2 billion in subsidy for 500,000 students enrolled in private schools and addition to funding textbooks," he said.

Andaya said the pension and gratuity fund for people who have given the best years of their lives to public service will be hiked by P4.5 billion.

"The budget will also allot P2.2 billion for the full implementation of the pay increase of soldiers and P1.9 billion for those of policemen."

Andaya said the allowance for inmates in government prisons will be increased by P5 a day, from P35 to P40.

The budget for shelter will be raised from P1 billion to P2.7 billion, including P1.6 billion for community housing, he added.

Andaya said P4.5 billion will be allotted to ensure an honest election next year and P200 million for tourism promotions.

Andaya said the top 10 recipients of funds are:

• Department of Education, P110.5 billion.

• Department of Public Works and Highways, P48.2 billion.

• Department of National Defense, P45.2 billion.

• Department of the Interior and Local Government, P43.9 billion.

• Department of Agriculture, P15.3 billion.

• Department of Agrarian Reform, P14.8 billion.

• Department of Health, P10.4 billion.

• Department of Transportation and Communications, P9.7 billion.

• Judiciary, P7.8 billion.

• Department of Finance, P6.8 billion.


Reported by: Sol Jose Vanzi

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