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Duterte OK’s proposed 2019 national budget

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Rodrigo R. Duterte
Quality spending on infrastructure and social services is at the center of the Duterte administration’s efforts to spur inclusive economic growth. -- AFP

PRESIDENT Rodrigo R. Duterte and his Cabinet approved in a July 9 meeting the proposed P3.757-trillion national budget for 2019 that is designed to help spur faster overall economic growth that will also lift more Filipinos out of poverty by the time he ends his six-year term in mid-2022.

Kahapon po ay na-approve po ng kabinete iyong ating budget for 2019; at ang ating budget po ay P3.757 trillion (Yesterday, the Cabinet approved our budget for 2019, and our budget is P3.757 trillion),” Presidential Spokesperson Harry L. Roque, Jr. told journalists in a briefing in Indang, Cavite on Tuesday.

The P3.757-trillion 2019 proposed national budget is slightly less than the P3.767 trillion programmed this year, since next year’s spending plan will have only allocations that can be disbursed within the fiscal year, versus previous obligation-based budgets that allowed implementing agencies to disburse funds over two years.

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Mr. Roque also said: “Ang major expense po natin ay (Our major expenses are): personnel services, P1.185 trillion (31.5% of the total); maintenance expenditures, P562.9 billion (15%); capital outlays, P752.7 billion (20%); allotment to local government units, P640.6 billion (17.1%); support to government-owned and controlled corporations, P187.1 billion (five percent); tax expenditures (tax subsidies for items like duties for state rice importation), P14.5 billion (0.4%) and debt burden which is 414.1 billion (11%).”

In a text message to reporters on Tuesday, Budget Secretary Benjamin E. Diokno said “[t]he 2019 budget amounting to P3.757 trillion was approved by President Duterte and the Cabinet in a marathon meeting last night that ended until 2 a.m.”

He also said the proposed 2019 budget “will be 19.8% of the gross domestic product” compared to 21.6% for this year.

Mr. Diokno said that, in proportion to the total proposed budget for 2019, allocations for social services (consisting of human capital investments like education and healthcare) for 2019 was cut to 36.7% from 37.8% this year and for economic services (such as infrastructure) was reduced to 28.4% from 30.6%, while those for general public services will go up to 18.9% from 17.4%, for debt service will rise to 11% from 9.9% and for defense will increase to 5.0% from 4.3%.

On July 2, the Development Budget Coordination Committee raised the revenue program for 2019 to P3.208 trillion from P3.203 trillion earlier programmed in the interagency body’s previous meeting in April, and 12.7% more than the P2.846 trillion targeted this year.

Disbursements for next year were likewise raised to P3.832 trillion from P3.782 trillion initially programmed and 13.7% more than the P3.37-trillion spending target in 2018.

This program will result in a P624.37-billion fiscal deficit that is equivalent to 3.2% of GDP, as well as 7.79% wider than the P579.23 billion initially programmed for 2019 and 19.23% bigger than the P523.68-billion deficit target this year — both equivalent to three percent of GDP.

The Department of Budget and Management has said that it targets to submit the proposed 2019 budget to Congress on July 23, the day Mr. Duterte delivers his third State of the Nation Address.

The current administration plans to increase spending on public infrastructure and social services in a bid to drive GDP growth to 7-8% annually till 2022 from a 6.3% average in 2010-2016, believing it will take such pace of overall economic expansion to slash unemployment rate to 3-5% by 2022 from 5.5% in 2016 and achieve its bottom line of cutting the national poverty rate to 14% also by 2022 from 21.6% in 2015. — Arjay L. Balinbin