13 January 2010

Show me the money!

TV INFOMERCIALS of the leading presidentiables suddenly flooding the airwaves last night forced me to check their platforms, whose links Manolo conveniently put up here.

After reading through them, I felt somewhat like Cuba Gooding, Jr's Rod Tidwell character in Jerry Maguire and shout at Noynoy Aquino, Manny Villar, Gibo Teodoro and Dick Gordon: "Show me the money!"

C'mon, guys! You're promising us heaven (especially Manny Villar, who proclaims he will finally write finis to poverty as we know it). But from the looks of it, whoever wins will be so cash-strapped his administration wouldn't even have enough money to support the current level of basic government programs and services.

I did some pencil pushing using data on the proposed 2010 national budget, which can be found at the DBM website. You can see for yourselves the tables, including my notes, assumptions and computations, which I uploaded as a Google spreadsheet. Sheet 4 contains the table reproduced above.

Assuming my calculations are accurate, the incoming administration, when it prepares its first budget proposal for 2011, will barely have P125 billion left to fund P174 billion worth of other obligations in the 2010 budget, assuming these are carried over next year.

This "free resource" -- arrived at after taking out personal services (salaries and wages for government employees, which will be pushed upwards by at least P50 billion annually over the next four years, thanks but no thanks to the Salary Standardization 3 law), the allocation to local governments (including their Internal Revenue Allotment or IRA), debt servicing, pension and gratuity for retirees, and the maintenance and other operating expenses for government agencies in the executive, legislative, judiciary and other constitutional offices -- further dwindles to P69 billion in 2012, and to only P9 billion in 2013.

What are these other obligations? Table II-2, which details the Special Purpose Funds included in the budget, includes the following:

  • Budgetary Support to Government Corporations, which include GOCCs like the National Food Authority; specialized hospitals like the Lung, Kidney, Heart and Children Center; the Philippine Convention and Visitors Center; the Philippine National Railways; the housing agencies NHA, NHMFC and Home Guaranty Corporation; Cultural Center of the Philippines; and research instituions like the PIDS and the DAP.
  • AFP Modernization Program
  • Calamity Fund
  • DepEd-School Building Program
  • E-Government Fund
  • International Commitments Fund, and
  • the Priority Development Assistance Fund, more popularly known as the pork barrel of the Senate and the House
And this assumes that government is able to fully fund its annual expenditure program; in other words, the BIR, the Bureau of Customs and the LTO are finally able to meet their annual revenue targets. Otherwise, it will continue to finance these deficits (which reached P234 billion in 2008 and should easily breach P300 in 2009) through another borrowing binge. Which will of course add more pressure on our debt position.

Several questions therefore I would like to ask our esteemed presidentiables:

1. Given these constraints, how are you going to fund the programs you committed to undertake in your respective platforms, particularly the money-draining populist ones intended to win you votes?

2. How will you plug the deficit, which will surely plague your administration?

3. If it is by raising more revenues, what new taxes will you certify to Congress as urgent? Which government properties will you sell or privatize? And what makes you think you will squeeze out more of BIR, BOC and LTO and other revenue generating arms of the national government?

4. If it is by reducing costs, which agencies will face the chopping block first?

It's time to cut through the bull, guys.

We deserve better than the motherhoods you've been serving up so far.

Show us the money, baby!


Anonymous said...

Thanks quest of sharing information. I’ve written and shared my thoughts around this on my blog.

Anonymous said...

thanks, willy! this is really an eye-opener, but still many pinoy voters will never know these facts, unless it makes the major news headlines, i guess...

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