Malacañang seeks P1.645T 2011 budget; GOCC funds get cuts

Malacañang on Tuesday submitted to Congress its proposed P1.645 trillion "reform" budget for 2011 with government-owned and -controlled corporations receiving the biggest appropriation cuts. House Speaker Feliciano Belmonte and Cavite Rep. Joseph Emilio Abaya, House appropriations committee chair, received the proposed General Appropriations Act of 2011 from Budget Secretary Florencio Abad. Abaya promised to start the budget hearings Sept. 1 in order to approve the proposal on second reading and transmit it to the Senate for review by Oct. 15 and ensure its enactment before the year ends. “We will adhere to the schedule. President Aquino doesn’t want a reenacted budget. Kakayanin namin with the general environment of hope in the House," he said in a press conference. “Pray for us," he then said in jest. In the same press conference, Abad said the proposed budget is 6.8 percent higher than 2010’s P1.54 trillion. The proposed budget includes programmed new appropriations of P933.5 billion and P711.5 billion in automatic appropriations that include debt service and interest payments of P357.1 billion; net lending of P15 billion; internal revenue allotment of P286.9 billion; and government contribution for employees’ retirement and life insurance premiums of P22.4 billion. The 2011 budget will be supported by P1.41 trillion revenues. Of the amount, P1.27 trillion or 90 percent will come from the taxes while P137.2 billion will come from non-tax sources such as fees, charges, income, and foreign grants. Narrower deficit Abad said the deficit for 2011 would be narrower at P290 billion from P325 billion this year. “This will be financed by P257.3 billion of domestic borrowings and P49.5 billion of foreign borrowings." The zero-based budgeting approach will be used for the 2011 appropriations, prioritizing the budget so that each item is justified according to the new administration’s priorities and the receiving-agency’s ability to achieve efficiency and effectiveness toward its objective, according to Abad. It will be used on departments that either got significant increases in the past or those that have huge allocations such as the Department of Education, Department of Public Works and Highways, Department of Transportation and Communications, and Department of Health. “We have to go through that. We hope to continue the process of reviewing the budget items up to the period or phase of budget execution," he said. For 2011, the DepEd including the educational facilities fund was appropriated P207.3 billion; DPWH, 110.6 billion; National Defense including pension, P104.7 billion; Department of Interior and Local Government including pension, P88.2 billion; Department of Agriculture, P37.7 billion; Department of Social Welfare and Development, P34.3 billion; DOH, P33.3 billion; DOTC, P32.3 billion; Department of Agrarian Reform, P16.7 billion; and the Judiciary, P14.3 billion. Mr. Aquino also decided to retain the intelligence fund of the Office of the President amounting to P500 million, Abad said. 41% less to GOCCs The allocations to GOCCs will be reduced by 41 percent, from P39.3 billion in 2010 to P23.3 billion in 2011 “in view of the GOCC reforms that will be implemented," according to Abad. Abad said the government decided to remove P8 billion in rice procurement subsidies to the National Food Authority and transferred the money to the DSWD’s rice subsidies for the poor enabling targeting based on the National Household Targeting Survey. “The general policy that we inducted is we cannot provide general subsidies anymore. The subsidies have to be targeted especially to the poor," he said. The Executive is also inducing some changes in the Light Railway Transit and the Metro Railway Transit for “eating up a lot of government funds because of subsidies. We are trying to make sure that either we improve operations or we adjust the tariffs," according to Abad. —VS, GMANews.TV