Slicing through the new president’s first budget proposal

Students denounce the budget for the National Task Force to End the Local Communist Armed Conflict during a protest, Sept. 9. (Photo by Jose Santos)

By MARJOHARA TUCAY
Altermidya.net

During the presidential campaign, many observers have called Ferdinand Marcos Jr’s campaign platform as too broad or too vague to warrant clear interpretations.

Fast-forward to today, as the proposed 2023 national budget is being railroaded in Congress, the new administration’s priorities are now getting clear. What’s in it for the people? Not much, apparently.

Something old

It is said that the national budget reflects the priorities of an administration. Just like any household budget, allotting more funds to a particular program, activity, or project directly translates to giving said agenda boosted priority.

An overview of the Php5.268-trillion proposed national budget reveals that Marcos Jr.’s priorities do not veer away that much from his predecessors.

Much akin to former President Rodrigo Duterte’s “Build Build Build” program, Marcos Jr is introducing his slightly tweaked “Build Better More” program, with his government proposing a total of Php1.196 trillion for infrastructure programs next year.

This amount makes the allotment for education (Php852.8 billion), health (Php296.3 billion), and even agriculture (Php184.1 billion), look measly.

Gabriela Rep. Arlene Brosas noted that Marcos Jr’s proposed budget only proves that even if there is a new president, the same old metrics and prioritization schemes are being employed when it comes to budgeting.

“The budget for infrastructure ballooned. Even the defense sector received large sums. Meanwhile, if we scrutinize the proposed budget more closely, deep cuts can be seen in basic social services, including direct aid, and funding for government assistance. This is amid a looming recession, and the nonstop inflation. Where’s the logic in this move?” Brosas said.

Research group IBON Foundation shared similar points, as it noted in a research brief that for 2023, big cuts can be observed in the social protection budgets for families and children (cut by Php20.3 billion or 45.9%), unemployment (Php10.8 billion, 33.9%), housing (Php2.6 billion, 56.2%), and social protection not elsewhere classified (Php24.1 billion, 9%).

“Slashing funds for social protection despite the unresolved pandemic and economic crisis shows the Marcos Jr administration’s insensitivity to millions of Filipinos in distress and its deliberate intent to ignore the country’s glaring problems,” IBON noted.

Something borrowed

When it comes to financing the national budget, the same pattern used by previous administrations can also be observed in Marcos Jr’s debut budget.

Not only will Marcos Jr’s fiscal managers have to bear the brunt of the trillions of debt that the Duterte administration left in its wake, the new administration is seemingly not keen on slowing down on amassing more debt.

Data from the 2023 Budget of Expenditures and Sources of Financing show that the Philippines is set to get an additional Php2.77 trillion in domestic and external loans by yearend 2023, escalating the outstanding debt of the national government by the end of next year to Php14.63 trillion.

Using the Philippine Statistics Authority’s 112.89 million Philippine population projection for 2023, it means that the Philippine debt per capita will stand at Php129,607 for every Filipino by next year.

“New faces, new figures, but what we can get from studying the proposed 2023 budget is this: the government is following the same old skewed priorities – using the same old tactic to amass more funds through loans and allotting these funds not for the direct benefit of Filipinos, but for the ruling clique’s businessmen supporters, generals, and their families,” Brosas stressed.

Continuing and expanding pork barrel

Weeks into the marathon congressional hearings on the proposed 2023 national budget, headlines on various budget cuts abound.

From significant cuts in the budget for pandemic response and hospitals, to cuts in the funding for direct aid, many observers have noted that President Ferdinand Marcos Jr’s debut budget proposal is reminiscent of the policies on scrimping funding for social services implemented by past administrations.

“The national government is in a tight fiscal position,” the Department of Budget and Management (DBM) has stated, in an attempt to explain the slew of budget cuts.

However, if one takes into consideration the fact that several other portions of the national budget have received considerable increases, DBM’s explanation will look illogical.

Amid all the reported budget cuts, the seeming victors in next year’s budget are none other than the two highest officials of the land.

Gaping blackhole

The current government setting, where a sitting president and vice president also concurrently serves as department secretaries, put both officials in a unique position – they both have control over the budget of two separate offices.

This curious situation has led to Vice President Sara Duterte controlling a total Php712.9-billion budget, far from the Php900 million budget that ex-Vice President Leni Robredo used to control.

Delving deeper into the Vice President’s budget, a more curious fact can be observed: she also has control over Php650 million confidential funds, or funds for “surveillance activities” in civilian departments and agencies.

This is just the tip of the iceberg. In total, confidential funds for 2023 will reach Php4.3 billion. This is about 430 times bigger than the total Php817.5 million confidential funds in the 2016 national budget, which is ex-President Rodrigo Duterte’s first year in office.

Confidential funds are part of what fiscal observers call the “black budget,” or portions of the national budget that not only lack details in disbursement and utilization but are also exempt from public scrutiny.

The other component of the black budget is the “intelligence funds,” which foot the bill for “intelligence information gathering activities of uniformed personnel and intelligence practitioners that have a direct impact on national security.” For 2023, intelligence funds will reach a total of Php4.9 billion, far from the Php910 million allotment back in 2016.

The black budget allocation has increased exponentially during the Duterte years. From Php1.7 billion in 2016, the black budget this year now totals Php9.6 billion.

Supposedly, the use of these funds is highly classified to ensure the secrecy of the programs and projects that the black budget is funding, with the belief that reporting specifics of these overt operations may jeopardize national security. Yet the blanket invisibility cloak placed over the multi-billion black budget can actually hurt – and not protect – national security as it is essentially exempt from crucial questions that taxpayers have the right to know.

Human rights group Karapatan has criticized this ballooning portion of the budget, which the group surmised would only be used for anti-people activities.

“Allies of the Dutertes and Marcoses didn’t even bother to ask questions on where these funds will be utilized. This speaks of the committee’s lack of independence and the inability to act for public interest,” Karapatan deputy secretary-general Roneo Clamor said.

“We also fear that these funds may just be some big money pot susceptible to corrupt practices. We call on the House leadership and the Senate to reallocate these funds for the most urgent needs of the education sector and for other basic social services,” he added.

Greatest pork of all

Yet the buck doesn’t stop at the black budget.

IBON executive director Sonny Africa noted that there are large portions of the national budget that Marcos Jr. has direct executive prerogative over. Collectively known as “presidential pork barrel,” this consists of portions of the budget that the president can directly allot, distribute, or control.

“When we talk about presidential pork barrel, we are discussing many layers. First of all, we can generally say that the whole national budget is actually presidential pork, as the Executive Department prepares it in its entirety,” Africa said.

“However, there is a layer where the president can exercise a wider executive prerogative, and these portions of the budget are usually lump sums,” Africa added. Lump sums are large amounts of funds with no specific budgetary item indicated.

“Lump sums enable the president and his secretaries to silently utilize the funds without the benefit of public or even congressional scrutiny,” Africa said.

One portion of the national budget that can be classified as part of the presidential pork are the automatic appropriations, which include the budget for debt service.

Since these funds are “automatically appropriated,” Congress is not able to exercise its power of the purse over these funds, and any amount set aside by the Executive under these funds are automatically approved, so to speak.

For 2023, automatic appropriations amount to Php1.6 trillion.

Another component of the presidential pork are budget items labelled as “Special Purpose Funds,” or funds which are designed to be released at the behest of the president or officials of the Executive Department. The total budget for Special Purpose Funds in 2023 amount to Php1.2 trillion.

One example of Special Purpose Funds is the “Contingent Fund,” which can – according to the special provisions that govern the said fund in the 2023 National Expenditure Program – be used for “deficiencies in the appropriations for local and external travels of the President of the Philippines.”

If we add up the black budget, the automatic appropriations, and the Special Purpose Funds for 2022, the estimated presidential pork barrel for 2023 would total Php2.8 trillion, or about 54 percent of the total national budget.

“This is the nature of presidential pork – it can be used by the President for his own pursuits without prior congressional oversight. At a time when budgets for social services are being cut, having a multi-trillion pork in the budget is beyond wrong,” Africa said.

“Fundamental policy changes must be put in place. We are still reeling from the economic impact of the pandemic. People are jobless. Prices are rising. We cannot just accept a budget that continues the extravagant and exorbitant pork traditions. We cannot just accept budget cuts on services that our people need the most,” Africa ended. Reposted by (https://www.bulatlat.org)

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