HOUSE Majority Leader Rolando G. Andaya, Jr. on Monday proposed to “re-examine” the 2019 National Budget when both chambers convene at the Bicameral Conference Committee.
Mr. Andaya, who represents the 1st district of Camarines Sur, made the suggestion in light of the country’s widening fiscal deficit, which he noted may surpass the 2018 target of P523.7 billion.
“Given this development, it is time we realize that the proposed 2019 national budget prepared by DBM is out of touch with reality,” Mr. Andaya said in a statement.
“We may have to re-examine the 2019 budget closely during the conference committee with the Senate.”
The conference committee is yet to convene, considering the Senate is still in the process of deliberating the 2019 General Appropriations Bill (GAB) at plenary level.
The chamber will resume discussions on the budget when session resumes on Jan. 14. The House of Representatives approved House Bill No. 8169, or the GAB on Nov. 28.
Asked for comment, Budget Secretary Benjamin E. Diokno told BusinessWorld over the phone that “the fiscal deficit is fine in line with our medium term fiscal program.”
Mr. Andaya also said the cash-based budgeting system, as proposed by the National Expenditure Program, may hinder the government in its efforts to address inflation.
“We are walking on tightrope and we need a really good balancing act. The DBCC (Development Budget Coordinating Committee) insists on a smaller contractionary spending program, yet the government needs to spend more just to catch up with inflation,” the Majority Leader said.
In response to this, Mr. Diokno said “on the contrary, we have adopted an expansionary fiscal policy and with tax reform and moderate deficit to GDP ratio of around 3.0% we can embark on an audacious ‘Build, Build, Build’ program and higher investment in human capital.”
The Budget Secretary also noted the state’s infrastructure spending is higher in the present administration than during the term of former President and now Speaker Gloria Macapagal-Arroyo.
“By comparison, infrastructure outlays as % of GDP under the Duterte Administration was 6.3% (2017-2018) compared to GMA’s 1.6% (2001-2010),” he said.
“No contest! Thanks for the advice but Duterte’s economic team is fine.” — Charmaine A. Tadalan