(STAR) By Paolo Romero - President Arroyo vowed yesterday to match the approval of the P1.126 trillion national budget passed by Congress with the resolve to increase revenue collections, cut red tape and reduce graft and corruption.

In a statement, the President welcomed the ratification of the 2007 General Appropriations Act (GAA), saying the measure will spur investment and create jobs.

She lauded lawmakers "for putting the interest of the people in the front-line by approving the budget."

The President described the approval of the national outlay, which broke the cycle of reenacting budget in the last two years, as "a brand new day for the Filipino people towards greater social, economic and political stability."

"This administration is prepared to match the approval of the budget with the full determination to collect the needed revenues to drive its expenditures, push disciplined spending and resource conservation, cut red tape and check graft and corruption," Mrs. Arroyo said.

Every item in the budget, she said, is designed to promote good governance, strengthen confidence and enterprise, drive up investments and jobs, deliver social dividends and fight terror and crime.

"This budget helps put our fiscal house in order and signals to the world that the Philippines is raring and more than ready to do more business and bring the fruits of the economy down to every household," she said.

The country’s economic growth is expected to rise this year thanks to increased spending on infrastructure and services under the 2007 budget that will soon be signed into law, senior officials said.

Under the P1.126-trillion budget, spending on infrastructure will be increased by P75 billion, said Budget Secretary Rolando Andaya Jr.

Last year the government spent P38.7 billion on infrastructure, the equivalent of 0.73 percent of the country’s total economic output.

Spending on public works, health and education will also be increased.

Andaya said even with the new budget, the government was still targeting a budget deficit of only P63 billion, adding that any additional revenues from privatization would be spent on infrastructure.

As the GAA heads to the Palace for Mrs. Arroyo’s signature, Andaya said his agency is preparing items that can be "frontloaded" before the public works ban 45 days before the May 14 polls takes effect.

Traditionally, summer offers the "good weather window" for road repair and classroom construction before the typhoon season and classes begin in June, he said.

But all spending, Andaya noted, would be done pursuant with the GAA and in obedience of election laws.

Section 261 of the Omnibus Election Code prohibits the "release, disbursement and expenditure of public funds" for certain types of public works activity.

The ban, according to a memorandum made by the legal department of the Department of Budget and Management (DBM), does not cover: emergency works in calamity areas provided they are limited to the restoration of damaged facility; foreign-funded projects; maintenance work of existing public works project, provided no additional laborer shall be hired; preparatory works and projects commenced before the start of the election period; and, housing and related projects.

However, projects implemented under these categories shall be reported to the Commission on Elections before the start of the campaign period for local candidates. — With AFP, AP

Chief News Editor: Sol Jose Vanzi

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