2018News

ConCom didn’t consult DOF on fiscal provisions

By Chino S. Leyco, August 13 2018; Manila Bulletin

https://business.mb.com.ph/2018/08/13/concom-didnt-consult-dof-on-fiscal-provisions/

Image Credit to DOF

The Department of Finance (DOF) denied yesterday that it was asked by the Consultative Committee (ConCom) to be involved in the deliberations of the draft federal constitution’s fiscal provisions.

Finance Undersecretary Bayani H. Agabin

Finance Undersecretary Bayani H. Agabin

Finance Undersecretary Bayani H. Agabin explained that ConCom invited the DOF only once and it was during the discussion on the division of the federated regions, an area outside the fiscal authorities’ expertise.

Agabin said that ConCom, which drafted the proposed federal constitution, invited the DOF last April 18 for an April 24 meeting, but they only read the fiscal provisions when the final draft was presented to them a day before it was submitted to the President.

“They first got in touch with us sometime in April and only got in touch with us only once, asking us to be present — it’s addressed to Finance Secretary Carlos G. Dominguez III… — and the matter for discussion did not even involve fiscal provisions,” Agabin told reporters.

“The matter for discussion only revolved on the question of how the regions, how the areas will be federated. That was the only invite we got and we showed up,” the finance official pointed out.

Agabin, who attended the meeting on behalf of the DOF, also noted that there was nothing concrete and mostly general inputs were discussed when they attended the first and only meeting in April.

“They were in touch with us from day one [but] we were not involved in the planning. If you compare that to the ongoing process in the lower house, in Congress, I think we’ve been invited several times and then we give our comments,” the DOF official said.

“The second time we met with them [ConCom] was I think a week before it was supposed to be presented to the President, with the secretary now, and they were explaining already the issues,” he added.

During its meeting with Dominguez, Agabin said the DOF raised the issue on national debt and the committee promised it will be the first cut.

However, Agabin disclosed that when the received the final draft of the Constitution, the provision on debt burden was missing.

“The first time we got a draft was a day before it was presented to the President, so there was no opportunity for us to give our comments,” Agabin said. “The fiscal foundations only covers barely two pages out of the 102 pages.

Agabin also denied that the DOF and the National Economic and Development Authority (NEDA) did not cooperate with the ConCom in data sharing.

If they asked, he said “I’m sure we gave them because they were looking at the information on how much the region received, how much the government was helping them and they also showed us data on the expenses. So, I’m sure they would have received the information.”

Finance Undersecretary and Chief Economist Gil S. Beltran, meanwhile, said that the draft federal constitution, if adopted and implemented next year, will result in P1.2 trillion in budget deficit for the national government.

This level of budget gap is equivalent to 6.7 percent of the economy, the highest in the country’s history, Beltran said.

“If you add all of those, it will be about P560 billion. Which would be taken out of the federal government, which would mean we would be cutting federal government expenditures,” he added.

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