10 March 2008
Debt & Public Finance
A day before Mrs. Gloria Macapagal-Arroyo signs into law the 2008 general appropriations bill, the Freedom from Debt Coalition urged the House and the Senate leaders to defend the special provisions on debt service cuts in the national government budget.
In a letter, FDC secretary general Milo Tanchuling urged leaders of both Houses of Congress to override Malacañang’s decision should Mrs. Arroyo veto specific stipulations on debt service reduction in the P1.2267-trillion budget. The group also expressed appreciation “for supporting the passage of the special provisions” in the budget and “the reallocation of these funds to augment social spending for education and health.”
“Should Mrs. Arroyo veto specific stipulations on debt service reduction, we urge the leaderships of both Houses of Congress to once again rise to the occasion by defending the said special provisions by means of a Congressional Override,” stressed Tanchuling.
The P25-billion debt payment reduction came from: the suspension of P5 billion interest payments to loan agreements challenged as tainted with fraud; the suspension of P5 billion worth of premature payments to proposed loans still in the pipeline; and, P15.9 billion savings due to the peso appreciation.
“In a time when our nation is undergoing a painful political crisis brought about by an aborted anomalous loan agreement that could have led to the government’s acquisition of another unnecessary debt, the Congress’ firm stand on the said special provisions will be a welcome respite,” added Tanchuling.
“We believe Congress’ decision to suspend interest payments for questionable loans pending renegotiation/condonation is a step in the right direction. Increasing the measly budget for much needed social services and restoring their power of the purse or constitutional duty to plan and manage the people’s hard-earned resources are another steps toward that direction,” said Tanchuling.
On February 21, the 14th Congress transmitted the budget measure, P300 million less than the Arroyo’s original budget proposal, to Malacañang for final signing and approval. It was reported that Mrs. Arroyo will sign the budget bill on March 11 and that the Department of Budget and Management has already drafted the President’s veto message of certain provisions in the 2008 Budget. -30-