MANILA (AdChoiceTV News) — While President Duterte’s chief economic manager supports more financial aid to vulnerable sectors amid the prolonged pandemic, he maintains that additional spending should be within the government’s means and not further bloat the budget deficit.
“The administration is very concerned about the rise in hunger and in poverty. And we believe that we must address this issue squarely and soon. So in that manner, we are in favor of a piece of legislation focused on those two issues—hunger and poverty,” Finance Secretary Carlos Dominguez III said during last Tuesday’s Senate committee of the whole hearing on the national vaccination program.
Dominguez was addressing Sen. Kiko Pangilinan’s question whether the economic team was supporting the proposed Bayanihan to Rebuild as One or Bayanihan 3 bill, which the senator said had yet to receive a certification indicating availability of funds from the Bureau of the Treasury.
But Dominguez pointed to the government’s fiscal problem where revenue collections were weakened by the pandemic-induced recession while the government had to spend more to fight the health and socioeconomic crises inflicted by COVID-19.
The Finance chief noted that this year’s budget deficit had been programmed to widen to 9.3 percent of gross domestic product (GDP), amounting to a record P1.86 trillion, from P1.37 trillion or 7.6 percent of GDP last year.
“Any additional expenditures like the P170 billion-P173 billion [for Bayanihan 3] have to have some source of funds. We are looking at additional collections over-and-above our budget. The President has already asked all the departments to look at their budgets and see which programs can be cut or postponed so that the money can be repurposed to fund this,” Dominguez said, referring to Administrative Order No. 41 issued last month.
“If there are any potential revenue-raising measures that the House [of Representatives] and the Senate will propose, then we are also open to that,” he added.
“It will be unsustainable if we have a fiscal deficit higher than what we have estimated this year,” he said.
The Finance chief, nonetheless, assured the senators that the government was internally looking for fund sources to cover the P173 billion needed for Bayanihan 3.
Sought to elaborate, Dominguez said: “If we are going to have another round of Bayanihan stimulus package this year, the economic team will work with Congress in looking for funding sources to ensure that it will not further widen our deficit.
Our goal, in keeping with the President’s policy of prudent fiscal management, is to keep our budget deficit within a manageable level. Hence, we want any additional expenditure to be deficit-neutral.”
“The Department of Finance has not proposed any tax hikes to increase revenue collections. We have taken actions to increase the dividend remittance of GOCCs (government-owned and/or -controlled corporations) to generate more funds.
As of end-May 2021, collections from dividend remittances have already reached P31.38 billion. We target to collect P47.17 billion in remittances for this year,” Dominguez said.
/CKM — AdChoiceTV News (Manila)