• Govt underspending has a simple cause: Incompetence

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    LATER this afternoon, President BS Aquino 3rd will deliver his final, highly anticipated State of the Nation Address.

    A large part of the reason this year’s SONA is so highly anticipated is that it is indeed Aquino’s last. Suggestions over the past two years that he remain in office by some means after the expiration of his term on June 30, 2016 having been met by most of the public, media, and political analysts with a reaction that could be politely described as “revulsion,” Aquino seems to have resigned himself to trying to influence the selection of his successor.

    While no one knows what Aquino will say until he says it (the speech is scheduled to begin at 3p.m.), we can be fairly certain he will devote a significant part of it discussing the qualities he imagines a successor would need in order to continue his “reforms.” He will also spend some time discussing the growth of the economy during his term, and to be fair to the departing president, there have been a few achievements he can legitimately claim, such as the signing of the pocket Open Skies policy early in his term, and more recently, the enactment of the Competition Law and much-needed amendments removing many of the restrictions of the Cabotage Law.

    The president will also highlight some of the projects completed during his term, such as the recently opened Muntinlupa-Cavite Expressway, a road four kilometers in length that took four years to build and cost P2 billion.

    The reason he will boast about this and probably a few others on the relatively short list of infrastructure projects completed during his term is that he will be attempting to deflect the most serious criticism directed against his administration over the past year: that poor budget execution and government under spending have been a drag on the entire economy, and the situation is not improving despite repeated assurances by the administration that it will.

    If he speaks about the “underspending problem” at all, Aquino will likely just parrot the same obtuse excuses his economic managers and spokespersons offer, confusing half-explanations of “utilizations of cash allotments” and “revised disbursement procedures,” all made necessary by the Supreme Court’s stern reminder that the administration simply cannot ignore the law and impound parts of the public budget to spend as it sees fit. Aquino will explain that underspending will be a thing of the past because the budget for the coming year, the largest ever at more that P3 trillion, will provide the government plenty of resources to help foster development and ‘inclusive growth.’

    At the end of last week, revenue figures from the Bureau of Internal Revenue (BIR) were released, and showed that once again, the bureau failed to reach its revenue target, falling short by a bit more than P8 billion for the month. In May, the shortfall was nearly P30 billion. Likewise, the Bureau of Customs, the other critical revenue-collecting agency of the government, through the first four months of this year has come up short of its revenue goals by an average of 14 percent per month.

    The budget is based on funding expectations, which are expressed as revenue targets. If those targets are not reached, there is a budget deficit, which forces the government to reduce its planned spending. Not recognizing this basic problem after five years displays a basic incompetence that should be Aquino’s real “mark on history,” as a reminder to those of us who have the power to choose our leaders to make better, more thoughtful choices.

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    3 Comments

    1. He did the right think. Kasi yung vultures nasa DPWH. So no project, no food for the vulture. Vulture has to find other food.

      Simple lang ang analysis, ikaw yata yung incompetent and doesnt follow the direction of this adminstration, stop or reduce corrpution. Public projects is one of the many source of corruption.

    2. ***Muntinlupa-Cavite Expressway, a road four kilometers in length that took four years to build and cost P2 billion. ****

      Wow fantastic infrastructure achievement by the aquino administration
      btw pwede pa idagdag yung underpass sa araneta ave.

    3. One thing I’m sure Sir, Noynoy will brag himself and to cover up all his committed sins. To me, SONA, is the “SINS OF NOYNOY AQUINO.” Sir Tiglao is very right when he enumerated and clearly explained the major sins committed by PNOY. THE WORST PHILIPPINES PRESIDENT EVER..