Delayed budget to upset Duterte’s infra program

MANILA – President Rodrigo Duterte finally signed into law this week the national budget for 2019, but the delay of more than one full quarter will almost certainly derail his massive “Build Build Build” infrastructure program.

Known as the General Appropriations Act for 2019, Mr. Duterte signed the P3.757-trillion budget bill on Monday, April 15, but not before vetoing P95.3 billion that members of the House of Representatives had inserted to fund their pet projects.

It was the second time that the lower house of the bicameral Congress had attempted to insert items into a bill after the House and Senate had passed an earlier version.

“The illegal realignments cannot escape the President’s scrutiny,” Senate President Vicente Sotto III said on Tuesday, April 16.

Senator Panfilo Lacson had noted that the insertions earlier this year were unconstitutional, and the Palace agreed.

Allies of House Speaker Gloria Macapagal-Arroyo had claimed that there was nothing wrong with the insertions, a stand taken by both majority and minority leaders.

Such insertions were little more than pork barrel under another guise, according to Lacson, who said this week that one fellow senator, Loren Legarda, had also attempted to insert items into the budget law that was included in the presidential veto.

Lacson said Mr. Duterte’s veto would result in savings of some P19.06 billion in “pork commissions” that the lawmakers would have received had their pet projects pushed through.

The president had earlier threatened to veto the entire budget if Malacanang’s legal team found irregularities in the law.

The delayed enactment of the budget will affect the national government’s spending, notably for infrastructure projects. For the first quarter of the year, the Duterte administration had been spending based on the 2018 budget, as required by law.

Earlier this year, Finance Secretary Carlos Dominguez said that any delay in the passage of the budget would have negative effects on the country’s economy.

The massive infrastructure program of the Duterte administration was meant to pump-prime the economy by creating tens of thousands of new jobs, thereby raising the country’s gross national product (GNP).

But since the infrastructure projects were not funded in the first quarter of 2019, they were not launched. Coupled with the ban on infra projects during the election period, as well as the expected arrival of the rainy season by June, the targets set by the government will be difficult, if not impossible, to meet.

Dominguez said that each day the budget was delayed translated to P500 million less fiscal stimulus.

Furthermore, the GNP target of between seven and eight percent for this year will have to be readjusted downwards to between 6.1 and 6.3 percent.

Ordinarily, national budgets were approved by Congress and signed by the president before the start of the year, or at the first month of the new year at the latest. This year’s delay was one of the longest in decades.