2019News

Neda: Exempt public infrastructure projects from spending ban

By Elijah Felice E. Rosales & Rea Cu, January 29 2019; Business Mirror

https://businessmirror.com.ph/2019/01/29/neda-exempt-public-infrastructure-projects-from-spending-ban/

Image Credit to Business Mirror

THE National Economic and Development Authority (Neda) will seek to exempt key infrastructure projects from the ban on spending during elections to minimize the adverse impact of a reenacted budget on the economy.

Socioeconomic Planning Secretary Ernesto M. Pernia said his agency will appeal to the Commission on Elections (Comelec) to spare some public infrastructure from the spending ban. He argued some government projects, including the rollout of the national ID system, are just “too risky” to stall.

“All we can do is ask for an exemption [from the] Comelec on the ban on spending,” Pernia said in a news briefing.

He said this is particularly important if the government will continue to operate on a reenacted budget. Estimates by the Neda put reduction in GDP for the year at 1.6 percentage points to 2.3 percentage points if the proposed 2019 national budget is not passed.

With the slowdown brought about by the reenacted budget, Pernia said the government has to make up for this through higher spending on infrastructure.

Neda Undersecretary Rosemarie G. Edillon explained there is a carryover fund for the implementation of the national ID system. However, some public works projects will be delayed without the new budget.

“I think the more problematic [thing about] the Comelec ban (are) for projects, like the [national ID system], and those that require [the] establishment of new agencies because they will need to hire people, [put up] plantilla and you will have a ban taking effect in March,” Edillon said.

February 6 meeting

The proposal to exempt key infrastructure projects will be taken up in the Cabinet meeting on February 6, according to Pernia. He is hoping President Duterte himself can seek a blanket exemption from the ban.

When asked if spending for the coming election will help offset the impact of the late passage of the budget, Pernia said, “we don’t know, but it would have been better because it would still be a minus on what could have been.”

In a separate news briefing, Pernia said the government is making “definite progress” in infrastructure development. “As of today, the Neda Board has approved 61 big-ticket projects amounting to P2.73 trillion.”

Of the 75 flagship projects under the government’s “Build, Build, Build” program, 44 projects are under various stages of implementation, 24 are under preinvestment study and the remaining seven are up for a review.

‘Fighting target’

Finance Assistant Secretary Antonio Joselito G. Lambino II echoed the sentiments of Pernia, adding that the immediate passage of the proposed General Appropriations Act for 2019 will help the government hit its target growth rate of 7 percent to 8 percent this year.

“Yes, that is the hope because that’s, I think one quarter is what we can afford given where we are now, hopefully not longer than that. Our fighting target is still 7 percent, that’s what [Finance] Secretary Sonny [Carlos G. Dominguez III] says,” Lambino said.

He said the Development Budget Coordination Committee (DBCC) will have to discuss if a revision on the target is in order given the delay in the passage of the 2019 budget.

“That will be something that the DBCC will have to decide, whether they have to revise,” he said.

Budget Secretary Benjamin E. Diokno also said discussions on the budget are already in its “critical stages,” and that the economic team never fails to stress the importance of passing the budget as soon as possible.

“We communicate with them the importance of having a new budget as soon as possible. Also, in light of the forthcoming elections and the election ban sometime in March this year. They know exactly the critical nature of the budget and we tell them that it is very important that we have a new budget passed as soon as possible,” Diokno said.

Dominguez said over the weekend that the delay in the passage of the 2019 national budget will cut government spending by P46 billion, which could halt the implementation of some public infrastructure projects.

Congress has already resumed sessions and will hold sessions until February 8. Lawmakers will go on recess from February 9 to May 19 for the midterm elections.

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