DoF: late passage of 2020 budget ‘detrimental’ to ph
Credit to Author: MAYVELIN U. CARABALLO, TMT| Date: Tue, 03 Sep 2019 17:41:12 +0000
THE Department of Finance (DoF) is urging lawmakers to pass the 2020 national budget after the government underspent by P178 billion in the first half of the year.
“We encourage the legislature to pass the budget on time after due deliberations, as the consequences of operating on a reenacted budget, as what happened this year, are extremely detrimental to the nation, [especially] the disadvantaged,” Finance Secretary Carlos Dominguez 3rd told reporters in a message on Tuesday.
His comment came after lawmakers at the House of Representatives clashed over changes in the General Appropriation Bill. The P4.10-trillion 2020 National Expenditure Program was transmitted to them on August 20.
In an economic bulletin also released on Tuesday, the Finance department said “the delay in the passage…of the 2019 budget weakened expenditures and the domestic economy.”
The DoF noted that expenditures eased by 0.8 percent in the first semester of 2019, the first drop recorded in such a period since 2011.
“This is a significant reversal from the 20.5-percent rise in the same semester of 2018. This is due to the four-and-a-half month delay in the approval of the General Appropriations Act by Congress,” it explained.
This is equivalent to an expenditure effort of 18 percent, a decline from the 19.42 percent recorded in the first six months of 2018 on account of the reenacted budget.
A dispute between Congress’ two chambers over alleged insertions resulted in the delay of the passage of this year’s budget. This forced the government to run on last year’s outlay, limiting it to spend for items detailed in the 2018 budget and not on programs and projects supposed to be implemented this year.
“The moderated growth in expenditures led to a lower NG [national government] deficit, which settled at 0.48 percent of GDP [gross domestic product],” the Finance department said.
That said, it projected government underspending to be about P178 billion, equivalent to about 2 percent of first-semester nominal GDP.
The country’s GDP in the first half of the year stood at 5.5 percent, well below the government’s 6 percent-to-7 percent official target range.
“A catch-up program has been adopted by the implementing agencies. This will boost growth performance for the second semester,” the DoF said.
This program set an infrastructure spending target of P792.97 billion for the second to fourth quarters after actual infrastructure spending reached P207.2 billion in the first three months of 2019.
In the first half, infrastructure spending reached P311.4 billion, P81.5 billion less than the programmed allocation of P392.9 billion.
Acting Budget Secretary Wendel earlier said the Department of Transportation had committed to spend about P53 billion in the last two quarters, or about 56.5 percent of its full-year target.
In the case of Department of Public Works and Highways, it has programmed some P542.6 billion disbursements, also in the second half, equivalent to 71.8 percent of the P755.6-billion spending commitment, he added.