By Bernadette D. Nicolas and Jovee Marie N. dela Cruz
PRESIDENT Duterte has approved the one-year extension of the validity of this year’s budget until December 31, 2020.
The House deputy speaker for finance on Thursday promptly touted this move, along with the expected signing by the President of the 2020 appropriations law, as two budget-related measures seen to propel the economy to a higher trajectory next year.
Rep. Luis Raymund Villafuerte said the 2020 General Appropriations Bill (GAB) of P4.1 trillion, which is now awaiting President Duterte’s signature, and the newly signed Republic Act (RA) 11464, which made unspent portions of the 2019 General Appropriations Act (GAA) available for release till December 31, 2020, will boost the economy.
According to Villafuerte, these measures would allow the government to accelerate state spending on infrastructure and human capital development, which, in turn, are sure to further boost the growth momentum and create more jobs for Filipinos.
“The swift approval of both measures by the House under the leadership of Speaker Alan Peter Cayetano best illustrates the unequivocal support of the bigger chamber for the vision of President Duterte to sustain the high-growth momentum, attack poverty and improve the lives of the Filipino people over the medium term,” he said in a statement.
The accelerated spending via the would-be enacted 2020 GAA plus the remaining funds under the 2019 GAA—and at a level never before reached in past administrations—would set off a double-barrel economic stimulus to boost the growth momentum, attract local and offshore investments, and create more jobs, he said.
“Both the 2020 GAB, which the President is due to sign in January, and RA 11464 would enable [the] government to sustain the catch-up spending strategy that Mr. Duterte’s economic team put in place this year’s third quarter to make up for the four-months-and-a-half delay in the passage of the 2019 GAA that hobbled economic growth in the first semester,” Villafuerte said.
“A strong economic spurt powered by much higher state spending and low inflation would keep the Philippines among the world’s fastest-growing economies for the remainder of the Duterte presidency, against the backdrop of weakening global growth brought about by, among others, the US-China trade spat, Brexit and climate change,” he added.
Given the sustained spending boost, Villafuerte said GDP growth is expected to clock higher over the October-to-December 2019 period to above 6 percent.
Experts also project the economy growing between 6 percent and 7 percent in 2020 owing to the timely congressional passage of the 2020 GAB, he added.
Earlier, Speaker Alan Peter Cayetano said there would be no economic implications if the proposed 2020 GAA is not signed into law before the year ends. Cayetano confirmed that Duterte will not be able to sign the P4.1-trillion national budget for 2020 before the year ends.
Extension law
Duterte signed RA 11464, extending for one year the validity of the 2019 budget, last December 20, Friday.
Congress earlier passed the measure after the Senate adopted without amendments House Bill 5437, which aimed to extend the validity of the allocated maintenance and other operating expenses, as well as capital outlays in the P3.662-trillion national budget.
The Act shall take effect 15 days after its publication in the Official Gazette or in a newspaper of general circulation.
To recall, the government was forced to operate on a reenacted budget for months since the passage of the 2019 national budget got delayed due to a number of issues, including alleged last-minute insertions and realignments by lawmakers.
The President was only able to sign the budget on April 15 this year.
Due to the budget impasse, new and continuing infrastructure projects were not started earlier in the year when the weather conditions were better. On top of that, the government also needed to comply with the election ban from March 29 to May 12.
The delay in the passage of the budget was also blamed for the slower GDP growth for the first quarter and second quarter at 5.6 percent and 5.5 percent, respectively. This is lower than the 6.6 percent and 6.2 percent recorded last year.
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