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Consolidating Consensus, Advancing People’s Struggles and Building Alternatives
Since the “Million People March“ on National Heroes Day, August 26, 2013, more and much more filth at the top of Philippine officialdom have been uncovered from the gigantic pork scams, going down in our history as among the worst stories of national thievery and betrayal. The pork scams have also renewed and invigorated a patriotic and civic spirit nationwide to involve in political governance, drawing in informed and expert discussions not only on pork but on the entire system of public finance and the development direction of the country.
Freedom from Debt Coalition (FDC) has joined the popular outcry, adding its voice to citizens fora and sending contingents to mobilizations in Metro Manila, Cebu, Iloilo, Davao and other urban centers of the country. It will do so again and again as it gives more attention to drawing out the voices and energy and seeking popular alternatives from the grassroot communities and workplaces of the working people – the most victimized and betrayed by the pork scams.
FREE THE BUDGET OF ALL CONGRESSIONAL AND PRESIDENTIAL PORK!
President Aquino’s decision to do away with the Priority Development Assistance Fund (PDAF) and find an alternative mechanism for it that is satisfactory to senators and congressmen is not acceptable. We demand the abolition of all pork: all budgetary allocations that are discretionary of a single person or authority and are provided lump-sum. We mean both Congressional and Presidential pork whether they appear as PDAF, special purpose funds or off budget items. The only exception are funds entrusted to the Executive to respond to disasters and other emergencies, which should be given defined paramaters and subject to official audit.
Out of the proposed P2.268-trillion budget for 2014, only P1.163 trillion will go to the programs proposed by departments and agencies, and P796 billion will go to automatic appropriations (for interest payment for foreign and domestic debts, among others). On the other hand, P139 billion is for “un-programmed funds” and P310 billion is earmarked for “special purpose funds,” which includes the P25 billion PDAF.
MAKE THE BUDGET REDRESS INEQUALITY AND SERVE PEOPLE’S EQUITY
Current discussions to look only for alternatives to the use of money provided for PDAF and other pork miss the essential point about the national budget: To whom and for whom are money allocated and actually delivered. The P10 billion Napoles scam were committed in the name of the peasantry and farm workers and the rural folk. The working but poor people in the cities were used as supposed beneficiaries for much of the other corrupted PDAF. This gigantic corruption, however, are on ly the latest of the aggravations and betrayals imposed on the working people through the government’s budget system.
Historic legislations to address inequality and provide equity like the never-ending agrarian reform for the peasant tillers and claims for ancestral lands of the indigenous peoples have always been sidelined in favor of other so-called priorities, including debt service payments. Only 60 percent of the P150 billion CARPER fund have been spent so far and yet, the extension law will expire by next year. This appropriation covers only around 1 million hectares though the agrarian movement claims that 2 million hectares are yet to be reformed.
Long-standing commitments to even solve the backlogs in education, health and housing, much less to upgrade them, are not reflected in the government budgets year after year. Public expenditure in education is only 2.2% of GNP in 2012, a far cry from United Nations Educational, Scientific and Cultural Organization’s (UNESCO) 6% of GNP benchmark for developing countries. That amounts to P3.763 trillion education spending backlog since 1996, when UNESCO adopted the standard. On the other hand, public spending in health is 0.35% of GDP, shameful compared to the World Health Organization’s (WHO) 5% of GDP benchmark. This explains why until now only 60 percent of our population have finished secondary education. Moreover, according to National Housing Authority’s (NHA) own estimates, the country’s housing backlogs/needs accumulated to 3,756,072 units from 2001-2010, costing roughly P1.126T (P300,000/unit).
Enduring inequalities between and among geographic regions should also be redressed . It is both striking and appalling that in the proposed 2014 budget, the poorest and hungriest (regions) in the Philippines have the lowest allocation. The poorest being in the Visayas, and the hungriests in Mindanao. Coincidentally, Mindanao has the biggest population of indigenous people. 11 of the 16 poorest provinces (below poverty threshold level) are situated in Mindanao including Lanao and Maguindanao, 3 in Visayas, 2 in Luzon.
The ever-growing budget for the Conditional Cash Transfer Program mustbe reviewed and scrutinized. While they contribute to alleviating hunger for certain periods of the year, hard data show they do not make a dent at all to bringing down the poverty ratios. The National Statistical Coordination Board (NSCB) itself said that poverty remained “practically unchanged,” comparing poverty incidence in the first quarter of 2012 with the same period in 2009 and 2006.
The middle and upper income professionals among the working people and small and medium business people also have much to complain particularly at this time that the Bureau of Internal Revenue has been tightening the loop on every possible taxable source of their income and profits only to find out that millions, hundreds of millions, in fact, billions are waylaid through corruption and other misuse and wastage of public money.
The entire people are the taxpayers of the country. Personal income taxes comprise only a portion of the whole the tax revenues of the government. The BIR figures of a yearly average revenue from income and profits of 39.39% (2001-2011) of the total national government revenues include corporate income taxes. Others come from indirect taxes like e-vat, other sales taxes, registration fees and the like which are paid by all citizens. Non-tax revenues ranging from royalties from Malampaya to sales of state assets to earnings of PAGCOR are people’s mone to which all the people are entitled to demand public accountability.
REORIENT THE BUDGET TO REBUILDING THE NATIONAL ECONOMY, ADDRESSING CLIMATE CHANGE AND SOVEREIGN FINANCING
One fundamental anomaly in our budget system that we have to correct is that Congressional deliberations on the budget are not guided by the development plan or framework such as the Philippine Development Plan (PDP). The President and the Cabinet which approve the NEDA-prepared PDP merely convenes the Legislative-Executive Development Advisory Council (LEDAC) which includes only leaders of both houses of Congress. There are no pertinent committee public hearings and plenary sessions of Congress to debate and approve the PDP. Yet, it should be the framework for Congressional deliberations and public discussions on the national budget.
The recasting of the national budget should occasion a review of PDP. Until now, despite the instabilities of the global market and the global financial crisis, the top PDP priorities are extractives, business process agribusiness that defeats land reform and ruins small farms, manufacturing for exports and infrastructures that serve more the further entry of global capital. The outcome as we know of this neo-liberal PDP is jobless growth, cheap labor, food insecurity and poor social services. Against climate change, we have yet to see the National Climate Action Plan integrated into and put at the center of the PDP.
What the nation needs is to put at the center of our national development plan industrial development to serve our domestic needs like food, clothing, education, health and housing as well as agricultural development based on agrarian reform and that ensures food security and integration with industry We have to reverse the neo-liberal framework of privatization, liberalization and deregulation to bring down the costs of electricity, water and fuel and ensure their regular supply to all and a definitive shift to renewable energy. More jobs coming from a robust industry and agriculture should be accompanied by promoting decent and regular jobs and better educational, health and housing services for the working people and their families. We should also review the restrictions imposed by various trade agreements under the WTO and AFTA on our economy and start dismantling them through diplomacy and tact.
Much of financing for our development comes from debts. From 2001-2012, debt service (interest payments and principal amortization) in our National Budget constitute an average 37.74% of national budget/total government expenditures. More importantly, debt service payments constitute an average of 63.55 % of the annual government revenues during the same period. The PDP must be reoriented towards financing development on our own. We can of course borrow but within the framerwork of a sovereign, democratic and responsible borrowing. A PDP that builds our homegrown strength is our best assurance that we can largely finance our own further development
FOR A TRANSPARENT, ACCOUNTABLE AND PARTICIPATORY BUDGET
The only solution to corruption of public funds is to institute open and effective measures of transparency and accountability. The only guarantee that the government budget will serve the people’s interests is to institute direct and indirect participatory mechanisms.
The most immediate steps that can be taken to ensure transparency and accountability is to improve the auditing process, broaden the scope of public hearings, and implement open access to the budgetary information and processes. All infractions of these processes must perforce be subjected to penalties. At this point, the most important measure that can be taken is the passage of the Freedom of Information Bill that can enable every citizen, any citizen, in fact to demand information and seek redress for corruption and misuse.
The bottom up budgeting or BUB which some quarters are proposing as an alternative may be effective at the time being at the local levels. But this can be a stepping stone to a completely different system in the years to come.
The pork scams are a great game changer. The winds of change are once again strongly buffeting the ship of state. Let us drive harder to get as much radical change as possible. – end -