House starts deliberations on proposed 2018 national budget

Members of the House committee on appropriations on Tuesday raised several issues related to the 2018 proposed national budget of P3.767-trillion, such as free tuition, rightsizing of the government, and the massive infrastructure program of the Duterte administration.

The committee chaired by Rep. Karlo Alexei Nograles (1st District, Davao City) started hearings on the proposed budget with a presentation by the Development Budget Coordination Committee (DBCC) on the macroeconomic parameters.

Those who gave the presentation were Budget and Management Secretary Benjamin Diokno, National Economic and Development Authority (NEDA) Secretary Ernesto Pernia, Finance Secretary Carlos Dominguez III, Bangko Sentral ng Pilipinas Governor Nestor Espenilla, Jr., and Deputy Governor Diwa Gunigundo.

Nograles in a media briefing said the budget proposal took into account the Tax Reform for Acceleration and Inclusion (TRAIN) Bill which was approved by the House earlier this year. The economic managers used as basis for their assumptions the TRAIN Bill version of the House, said Nograles.

Nograles said it would be a challenge for the government economic managers to find ways on how to meet the P134 billion projected revenue from the TRAIN if the measure is not enacted into law next year.

I think our economic managers will have to be creative in finding ways on how to meet the P134 billion that they assumed would be derived from Tax Reform Package One. Or kung pumasa pero malabnaw, watered-down, magiging challenge yan, said Nograles.

He said the question would be if the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC) have to raise their collection targets or if the government has to resort again to borrowings.

Tayo ba ay magpupursigi para ang BOC at BIR ay taasan ang kanilang collection para mahabol ang P134 billion or tayo ba ay hihiram uli? If we borrow, our borrowings will be 80 percent domestic and 20 percent foreign. Ang importante, hindi dapat mag-suffer ang mga programa sa 2018 dahil para sa kapakanan ito ng ating mga mamamayan, said Nograles.

On the rightsizing of the government, Nograles said P10 billion has been set aside for its expected implementation next year. The amount was based on the assumptions made by the economic managers such as the cost of the separation package and how many employees would opt to stay in the government service.

He said the rightsizing program will take two years to be fully implemented. It will be halfway implemented in 2018 and fully implemented by 2019, said Nograles.

Nograles said the P10 billion budget for rightsizing can be found in the Gratuity and Pension Fund of the 2018 budget. If the Rightsizing Bill is not enacted into law, then the P10 billion stays in the budget. It will not be used, he said.

He said there is no exact number of employees to be affected by rightsizing. A technical working group will be created that will conduct a study on what offices and agencies in the government will be affected by the program. The TWG will then present the result of its study to a committee composed of the DBM Secretary, Executive Secretary, NEDA Secretary and representatives of the Presidential Management Staff (PMS) and Civil Service Commission (CSC).

Of the 200,000 employees estimated to be affected, Nograles said only about five to 10 percent will actually be covered by the rightsizing. He explained rightsizing does not mean abrupt removal of employees.

Whoever will affected will be put in a training pool which will retool and retrain the employees for deployment to another office. But they have the option to accept the separation package offered by the government, said Nograles.

Meanwhile, after the DBCC presentation, Rep. Tom Villarin (Party-list, Akbayan) asked what happened to the Public-Private Partnership (PPP) projects of the past administration and how the PPP approach will fit in the Duterte administration's Build, Build Build program.

Dominguez said the Duterte administration did not stop any project of the Aquino administration.

You remember when the Aquino administration took over, they stopped all the projects from the GMA (Gloria Macapagal-Arroyo) administration. We, we did not. We just continued with them and whatever PPP projects are on stream already, we just let them go (on). However, for the future, we determined that the PPP takes too much time. Ang negotiations noon will already take you 30 months, so we decided to start the projects directly with the budget funds that we have. And then we will continue the PPP projects after they are started, said Dominguez.

There are two benefits for this approach, said Dominguez. One, we can start immediately, and Two, there are funds around the world that do not want to take the construction risks. So therefore, we are increasing the size of the potential bidders for the PPPs that we have already started, said Dominguez.

He said another problem with the last administration's PPPs is that they charge a huge premium. Which really is taxation without representation because the PPP proponent will recover that huge premium that will be paid to the government for the users of the project. So in effect, you are taxing the user of the project without passing through this august body. We are philosophically against that kind of raising funds. So therefore, we decided to do the projects and then do the PPP after, said Dominguez.

Meanwhile, Rep. Sarah Jane Elago (Kabataan, Party-list) asked why in the 2018 budget there is no mention at all on sustaining the free tuition in State Universities and Colleges (SUCs). Bakit po nawawala ang pondo dito sa next academic year?,she asked.

Elago also asked if this means that the Duterte administration does not support free higher education.

Diokno replied that in the absence of any law, the government cannot appropriate any money for free tuition. At the same, he said there is a huge budget for the 114 SUCs in the country.

We can easily provide scholarships for the poor students by mandating each university to set aside part of their budget for the poorest 30 percent. The reason why we subsidize elementary and secondary education is because it is provided for in the Constitution. And there is strong argument for subsidizing basic education precisely because of the externalities, we want a well-grounded population. Yun pong sa college education, ang benefit po nun mapupunta sa individual, hindi na sa society, said Diokno.

Source: House of Representatives

Related posts