07 April 2008
Debt & Public Finance
A group of civil society organizations condemned today the president's veto of the provision in the General Appropriations Act which put on hold interest payments for questionable loans, including that which bankrolled the substandard Austrian medical waste incinerators installed in twenty-six hospitals run by the Department of Health (DOH).
In the second leg of the Illegitimate Debt Forum Series held at the Philippine Heart Center, Health Care Without Harm, Freedom from Debt Coalition, and Eco Waste Coalition, members of the broad network called People Against Illegitimate Debt (PAID) pointed out that in the national budget passed by Congress, the payments for interests of what they termed as illegitimate debts were realigned instead to finance social services, thereby augmenting the budget of the DOH by P6.812 billion for a total of P18.9 billion.
With Mrs. Gloria Macapagal-Arroyo's veto of the suspension of debt interest payments, the civil society groups however were concerned that the augmented expenditures for health approved by Congress may not materialize.
According to Director Maylene Beltran of the Health Policy Development and Planning Bureau, the DOH originally requested only P14.9 billion, but Congress passed a 66 per cent increase in the DOH's budget for this year. Among others, the budget for the reduction of malaria, leprosy, TB and HIV-AIDS was increased by 327 per cent; for environmental health by 2,918 per cent; and, for the upgrade of health services by 27 per cent.
The extra funds the DOH got in the national budget was sourced from the suspension of debt interest payments for questionable loans.
Director Beltran said that the partnership between the DOH and civil society groups in working on health issues has greatly helped to push for an augmented budget for health services in 2008.
"There is a great need for us to concentrate our efforts in reaching the targets set by the Millenium Development Goals. Our maternal mortality rate, for instance, is still very high at 162 deaths per 100,000 live births," Said Director Beltran.
Director Beltran also noted that historically only about 75 per cent of the approved budget for the DOH is ultimately released by the Department of Budget and Management.
The president's veto, according to the groups, honors illegitimate debts that were not only useless but had actually financed projects that were harmful to the people.
According to Ronnel Lim, program officer of Health Care Without Harm, one such illegitimate debt is the Austrian loan that installed medical waste incinerators which were later found out by the DOH to be emitting extremely high levels of dioxins, which were up to more than 800 times the acceptable level.
"For the harmful and useless incinerators, we now have to pay roughly 2 million dollars in principal amortization and interest payments until 2014," added Lim.
Emmanuel Hizon, FDC debt and public finance campaigner, said that the debt service suspension made by Congress should be a reminder to everyone that the illegitimate debt problem goes beyond the recent headlines generated by the scrapped ZTE Broadband project.
"We all need to take a much closer look into all these anomalous loans incurred in the past in name of the Filipino people," said Hizon.