|
|
|
News
September 7,
2011
Congress faced with four choices on 2012
budget due to unrealistic macroeconomic
assumptions—Social Watch
The lead convenor of Social Watch
Philippines today said members of
Congress are faced with four challenges
on how to deal with the P1.8 trillion
proposed national budget for 2012 in
light of the increasingly unrealistic
macroeconomic assumptions to which the
budget measure was based on.
According to Prof. Leonor Briones,
former national treasurer, members of
Congress can choose to either pass the
proposed budget with the risky
macroeconomic assumptions and
calculations because the solons are
rushing to approve the appropriations
measure before the year ends. Together
with the administration, Congress will
run the risk of passing a budget whose
goals may not be attained.
A second choice is for lawmakers to
require the administration’s economic
team to give an update before finally
acting on the budget proposal to show
the situation now. On the basis of the
updates, adjustments and corrections can
be made on the revenue targets as well
as the expenditure priorities.
Briones said a third choice is for
lawmakers to make the appropriate
adjustments as part of their roles or
the solons can cooperate with civil
society and media in monitoring the
entire budget process which is the
fourth challenge.
“Congress can make the appropriate
realignments to ensure responsiveness to
realities of national and global
developments. Lawmakers can also work
with civil society and media in
monitoring the entire budget process and
jointly work towards a genuine budget
reform,” she said.
Briones highligted these four challenges
to Congress during the presentation of
the Alternative Budget for 2012 of
Social Watch Philippines before the
House committee on appropriations
chaired by Cavite Rep. Emilio Abaya.
The Alternative Budget Initiative (ABI)
is a crusade for a participatory,
transparent and accountable budget
system. It started in early 2006 when
NGOs led by Social Watch Philippines,
advocating for social development and
economic justice, worked to collectively
engage in the budget process. The
objective is to present a concrete
alternative to the budget presented by
the President
In her presentation, Briones explained
the basic issue is that the budget is
based on macroeconomic assumptions
wherein the government assumes a
particular level of growth and other
economic indicators.
“The budget is the instrument that you
will use to help achieve that growth.
The question is, are the macroeconomic
assumptions realistic in relation to the
GDP, and in relation to the global
developments and as well as local
developments? Are they achievable, are
they realistic assumptions?,” Briones
said.
She explained that first, on the macro
economic assumptions on the GDP, the
assumption is that the country will
reach 5.5 percent to 6.5 percent GDP
growth for 2012. The PDP (Philippine
Development Plan) meanwhile assumes it
to grow to 7 percent to 8 percent within
the term. Furthermore, the NEDA is
saying the 8 % GDP growth is achievable.
However, she said the 2012 budget is
based on a 6.5 percent GDP growth
forecast. “So how do you reconcile the
two? You can’t reconcile it with the PDP
target which is higher,” Briones
explained.
Secondly, she said the macroeconomic
assumptions will be difficult to attain
because of global developments, and the
current state of the economy.
“For the first quarter, our growth was
4.9 percent and 3.4 percent for the
second quarter. It is nowhere your
famous 5.5 percent to 6.5 percent
target. It’s too far off. Can we still
achieve that? It might be difficult
because we’re now in the first half of
the year. It is an indicator of what
might happen in 2012. Every thing builds
up,” Briones said.
The Bangko Sentral ng Pilipinas has
warned that the growth of the economy
might be even slower during the second
half of the year.
Briones also cited that the Credit
Suisse, the Swiss financial services
company, has downgraded the economic
growth forecast for the Philippines for
the rest of 2011 from 4.6 percent to 4.3
percent.
“It seems our macroeconomic assumptions,
on which the 2012 budget is based, are
not realistic. Do they capture the
risks?,” she said.
Briones further said the industry and
services sectors are the major drivers
of growth in the country, but both are
not sustainable. “The industry sector is
largely mining industry. “Both industry
and services are not sustainable. On the
part of agriculture, it recovers but
remains vulnerable.”
She said the economy continues to be
consumption-led. The expected global
slowdown, especially with the US, will
affect remittances according to her.
“One of the drivers of our growth right
now is private spending. Not government
spending but private spending. The risk
to remittances is higher because more
than 50 percent of our remittances come
from the Americas --- United States,
Latin America, etc. There are more
Filipinos in the Middle East but the
remittances from the US are greater. But
the US has been downgraded,” she said.
Briones said the country’s external
trade also loses luster, resulting in a
trade deficit, as exports growth slowed
down to 3.3 percent from last year’s
double-digit growth rates due to the
weakening external demand. This is also
due in part to rising peso value, which
hurt not only export of merchandise of
goods but of services as well (e.g.
outsourcing and off-shoring). (30)
^ Back to top |
|
Whistleblowers advise P-Noy to hone new
Government workers as army against
corruption
Groups show strong support to Congress’
Bills on People’s Participation in
Budgeting, February 22, 2011
Congress urged to Act Fast on People’s
Participation in Budget Deliberations
Act, February 20, 2011
Extreme vigilance over lump sums urgent
in 2011, January 20, 2011
Study
reveals scant Filipino people power on
public funds, January 20, 2011
Budget activists hit signing of 2011
budget law, December 28, 2010
House Speaker and
Senate President pledged more funds for
the MDGs,
September 15, 2010
Citizens’ groups
offer Shadow Report to help Gov’t catch
up on MDGs, September 15, 2010
Civil
Society group challenges P-Noy, ‘Will
you be the President to accomplish the
MDGs under your watch or will it be
business as usual?, July 27, 2010
Reveal and use
invisible budgets to achieve poverty
eradication goals – budget watchers
urged P-Noy, July 26, 2010
Ensure no pinoy left behind – social
watchers tell P-Noy, July 25, 2010
Cong. Tanada gets two thumbs up for P10
M pork barrel slash – July 8, 2010
The first thing P.Noy should do is to
release the impounded funds for basic
services – budget advocates, June 29,
2010
Noy told: ‘Don’t
do a Gloria’;
Release
budget on time - Group
UN Millennium
Campaign urges decisive actions from new
administration
Probe Launches
Search for the Philippines’ MDG Warriors
Kaakbay Nominee,
Briones hits IMF and DOF for the VAT
Increase Proposal
LGU-Civil Society
Partnership for the MDGs - set off in
Negros Oriental
More news on Archive
|
