By Arjay L. Balinbin, December 19 2018; Business World


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BUDGET Secretary Benjamin E. Diokno said on Wednesday that the proposed P3.575-trillion 2019 national budget might be signed into law in mid-February, with the effect that disbursements will fall P44 billion in the first quarter.

“We estimate that in total, a reenacted budget for the first quarter of 2019 will reduce total disbursements by an estimated P44 billion for one quarter — if it is delayed by one quarter. However, if it’s not passed at all, on a full year basis it will reach P219.8 billion or P220 billion,” Mr. Diokno said in a briefing at the Palace on Wednesday morning, Dec. 19.

He added that a “reenacted budget will be detrimental to the economic growth and development objectives” of President Rodrigo R. Duterte’s administration.

“The government intends to ramp up investments in public infrastructure, poverty alleviation and social services. And we are hopeful that the legislators will see the urgency and wisdom in passing at the soonest possible time the national budget for 2019,” he said.

He also said that the 2019 budget might be passed in the “middle” of February at the earliest, and may come as late as March.

“Let’s say they approve it last day of January. They will have to go to the printing press, that’s about a week. When the documents are forwarded to the executive, they cannot be signed right away — they have to be studied line by line to come up with the Statement of Difference… We will have some criteria on whether to veto or not to veto. Like for example, if there is an improvement over our proposal, we let it go. But if it does not belong to our priorities or it’s… in fact, goes against our priorities, I will propose a veto. So, it takes about another week, and then there is a requirement under the law that you need 15 days after signing for the law to take effect. So that maybe brings us to March,” he said.

Mr. Diokno said that under a reenacted budget, no new infrastructure projects can be started “because the capital outlays component of the previous year’s budget cannot be deemed reenacted,” and “only the personal services and the maintenance and other operating expenditures are deemed reenacted.”

“The reasoning is straightforward. You cannot fund and finish the same project twice, right? Hence, new projects will have to wait until the 2019 General Appropriations Act is passed into law,” he added.

The large projects, however, which are covered by the Multi-Year Obligational Authority or MYOA “will not be adversely affected.”

Mr. Diokno said the large projects, such as the subway and the Philippine National Railways (PNR) long-haul project, will also not be affected. “At the same time, the internal revenue allotment for local government units, some P600 billion, and debt service will not be affected as they are automatically appropriated. And therefore, they will receive the budgetary allocations based on the 2019 National Expenditure Program,” he added.

Meanwhile, salaries, wages, pension and retirement benefits for personal services, maintenance and other operating expenses are deemed reenacted, “but they will be based on the 2018 level,” Mr. Diokno said.

“This means that salary adjustments for civilian and military personnel which are programmed for 2019 will have to wait. I repeat: the fourth tranche of the salary standardization for government employees will be deferred until such time the 2019 General Appropriations Act is passed into law,” he said. — Arjay L. Balinbin