CONGRESS’S failure to approve the proposed 2019 national budget of P3.757 trillion before the year-end will affect the country’s economic growth for the first and second quarters of 2019, as there will be a five-month implementation gap for the infrastructure projects, Budget Secretary Benjamin E. Diokno said on Tuesday.
Diokno said the national budget for 2019 may not be signed into law before December 31, based on the new calendar transmitted by the Senate to the Department of Budget and Management.
The earliest possible date for Congress ratification will be on January 25, 2019, and the latest possible date would be on February 7. If this is followed, this will be the first reenacted budget under the Duterte administration.
Because of this, Diokno said no new projects can start until the 2019 General Appropriations Act (GAA) is approved.
“We want to be able to frontload projects at the start of the year, if possible, especially infrastructure projects,” he said. “The failure of the Congress to pass the GAA before December 31 will not allow us to do that. Add this to the election ban from March to May, and you have a five-month implementation gap for our infrastructure projects.”
However, he clarified that this will mainly cover the small projects, such as roads and school buildings, and this development will not affect the big infrastructure projects most of which are covered by the Multi-Year Obligational Authority. Although Diokno stopped short of zeroing in on a figure, he said there will likely be a slowdown in the capital outlays for the first two quarters next year.
However, he said they are still confident that the government can meet the GDP growth target of 7 to 8 percent for next year. “It will slow down by first and second [quarters] but it could still pick up by third and fourth,” he told reporters.
Capital spending proposed for 2019 will have to wait until the 2019 budget is passed and becomes effective. The 2018 capital outlays cannot be reenacted because projects funded in 2018 are assured to have been obligated or done in 2018 and no new projects can be authorized to start without authority from Congress, with few exceptions, including large projects covered by Multi-Year Obligational Authority.
Nonetheless, personnel services (salaries, wages, pension and retirement and the like) and other operating expenses are deemed reenacted and will based on the 2018 level.
Meanwhile, salary adjustments for civilian and military personnel programmed for 2019 will also have to wait.
Change of heart
Diokno said it is still possible the lawmakers can change their mind about the schedule of passing the money measure “before Christmas and [it will] be their Christmas gift to the Filipino people.”
This, as Diokno also scored the lawmakers for having long breaks even before passing the 2019 budget.
“They marched to a different tune. Their time zone is different. How can you just work for just three days? Monday to Wednesday? What are they doing from Thursday, Friday, Saturday, Sunday? They have so many breaks,” he said.
Diokno has since said the President has given Congress “more than enough time to scrutinize the budget.”
“The reason we submitted the budget on the day of the State of the Nation Address [Sona] is to give them enough time so that this thing will not happen,” he said. “Under the Constitution, the President has 30 days after his Sona to deliver the budget to the House.
We don’t do that. We delivered it on the day of the Sona itself to give them more time so they can’t blame us. That’s very clear. We have done our job,” he said.
Incidentally, the government operated under a reenacted budget under the last years of former President Gloria Macapagal-Arroyo, who is now House Speaker.