CONGRESS  SEEKS  2008  BUDGET  REVISION 

MANILA, OCTOBER 4, 2008 (STAR) By Aurea Calica - Four senators called on the government yesterday to revise next year’s proposed national budget of P1.415 trillion to focus on programs that would ensure stable livelihood and income for the poor.

In separate statements, Senators Manuel Roxas II, Loren Legarda, Edgardo Angara and Senate Minority Leader Aquilino Pimentel Jr. said the situation had drastically changed since the budget was crafted and the government must shift priorities.

Roxas said boosting the agriculture sector should be made top priority to achieve food security.

The necessary assistance must be extended to farmers to spare the local economy from the backlash of rising world food prices, he added.

Roxas said each item must be evaluated in next year’s budget, especially lump sums whose uses were not clearly defined and which could be a source of corruption.

“We really need to tighten our belts but it does not mean we should not provide social services for the poor,” he said.

Legarda said the adjustment of growth targets was long overdue because the impending US recession had long been forecast.

“We should have factored in this reality in making realistic growth and macroeconomic estimates as basis for the formulation of the budget. Because such has not been factored in, government should adjust its revenue projections,” she said.

Angara said instituting more financial reforms would improve and strengthen the country’s financial system amid threats of a global economic slowdown.

“The banking reforms of the past years are paying off, making the Philippine financial market capable of absorbing shocks. Governor (Amando) Tetangco of the Bangko Sentral ng Pilipinas (BSP) gave assurance that for now, the Philippine banking system remains stable and this is because of the reforms we have instituted before,” he said.

Angara said more structural reforms need to be established to ensure that the local financial system would remain resilient, among them amendments to the BSP’s supervisory activities, the Corporate Recovery Act and the Collective Investment Schemes Law.

“Now is the time to fast-track all financial reforms. Crisis such as this has underscored the immediate impacts of reforms we are trying to undertake,” he said.

“And through continued financial reforms, the Philippines will be in a better position to face global financial turbulence.”

Pimentel urged the government to stop withholding development funds to stimulate the economy and to help shield the country from the impact of the financial crisis that hit the US and Europe.

A hike in public spending for infrastructure and other development projects would increase the money in circulation and help stabilize the economy, he added.

Pimentel said the government was resorting to withholding funds to generate savings and narrow down the budget deficit ostensibly to impress foreign creditors and international credit rating agencies.

“Whatever funds that are being frozen by the government without sound and justifiable reasons should be released,” he said.

Pimentel said Malacañang must heed the suggestion of congressional leaders to suspend or scrap the tariff on oil and the l2-percent value added tax on petroleum products to help ease the economic hardship of the people.

The suspension of oil tariff and VAT on petroleum products would reduce the cost of production and distribution of prime commodities, and bring down their market prices, he added.

Pimentel said the government’s plan to sell its remaining 40 percent share in Petron would only further erode its ability to influence market prices of petroleum products.

“With the financial meltdown in the US and Europe, we should rethink the mass privatization of government corporations. Unbridled capitalism is disastrous to the economy,” he said.

Opposition to seek budget reduction At the House of Representatives, the opposition will seek a reduction of at least P100 billion in next year’s proposed national budget.

“Our figures will show that there is roughly P100 billion to P200 billion that can be cut and we can still have a responsible budget that addresses the requirements of more infrastructure,” Minority Leader Ronaldo Zamora told reporters yesterday.

“We want a figure that provides some growth, a growth that can be absorbed by the economy. Definitely, it will still be an increase (over this year’s budget), but an increase that we can probably afford.”

The proposed 2009 budget is about P190 billion more than this year’s expenditure level.

Asked to comment on Zamora’s reduction proposal, Budget Secretary Rolando Andaya Jr. said Malacañang would oppose the huge cut in the budget.

“We think our proposal would allow us to prepare for whatever adverse effects the financial crisis in the United States would have on our economy,” he said.

On the other hand, Quirino Rep. Junie Cua, House appropriations committee chairman, said the budget should not be cut “to enable the government to pump-prime the economy.”

Meanwhile, Zamora said he and other opposition lawmakers would not touch funds for infrastructure, agriculture, health, education, and vital social services in trying to cut the budget.

“We’re going to do it by agency, most especially by program and lump sum appropriations. It will mean less presidential pork,” he said.

He said the items they would propose to be reduced include expenses for travel, intelligence gathering, donations, training and seminars, and other non-essentials.

The travel budget for the entire bureaucracy next year amounts to several billion pesos, he added.

He said they would also take out from the 2009 outlay funds that could be used for purposes of the 2010 presidential-congressional-local elections.

“This is a classic example of an election budget,” he stressed.

Zamora said if the government is unable to support its budget proposal for next year, any or all of three things could happen. – With Jess Diaz


Chief News Editor: Sol Jose Vanzi

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