THE six-year Aquino administration is almost over and it is still plagued by the very same problems it started with—it needs to spend more and speed up projects under the public private partnership (PPP) program to boost the economy.
The government has failed to stimulate economic activity in the country as shown by the first-quarter economic numbers.
Gross domestic product grew by only 5.2 percent, more than 20 percent below expectations. Economists blamed the slowdown in the growth to underspending by the national government.
Does the Aquino administration not know how to spend without pork barrel or its Disbursement Acceleration Program (DAP), which the Supreme Court had declared unconstitutional?
The drop in infrastructure spending brings down GDP and employment.
Government spending must now be pursued aggressively for sustainable growth and job generation.
The private sector is doing its part. The taxpayers are doing their part. What is the government doing?
I mean, how hard is it to spend our taxes? Apparently, with this administration, very hard.
The Aquino administration has been quite diligent in collecting taxes. The country’s tax effort has been on an upward trend in the past four years from 12.2 percent in 2010 to 13.6 percent in 2014. It has set a goal of further raising the tax effort to 16.6 percent by 2016.
But like I said in previous columns we need to see concretely where our taxes go and how they are spent.
Taxes should be spent primarily on public infrastructure, education, and health services.
Taxpayers who need healthcare should be able to go to any public hospital and get quality treatment. They should be able to send their kids to public schools and get quality education. They need well-built roads that do not flood after short downpours and are not clogged with traffic. They need well-lit, clean and safe streets, not dark, dirty and crime-infested ones. They need a government that can be relied upon to take care of them if they lose their jobs or once they are old and can no longer work.
If the government cannot guarantee these then it is better off reducing taxes so that the people can have more money to spend and the private sector can stimulate the economy.
Reducing income taxes would put more money in the pockets of workers to help them cope with the high cost of living. This money would be spent on goods and services thereby boosting the economy.
More money for workers to spend means increased demand for goods and services, which results in more jobs for more people to spend more money, which results in more people paying taxes and the government making more money.
If the government is inefficient it is better off taking a backseat.
Several investors during the trips of President Aquino abroad have signified interest in the infrastructure projects but despite its launching, PPP projects have been delayed as government agencies continued to review costs and procurement procedures. What PPP projects have been finished so far?
And after nearly five years on the job, Aquino and his people have not figured out public finance or proper budget planning. They don’t know how to plan and program projects in the pipeline.
Infrastructure construction is stagnant. Government infrastructure spending dropped by 24 percent in the first three months of 2015.
The Aquino administration implemented the K-to-12 curriculum change and yet the government’s budget allocation for education could not even address the severe lack of classrooms, teachers, textbooks and other basic needs.
The power sector is supplying one of the most expensive electricity rates in the world.
The government is helping the poor only through its multibillion conditional cash transfers.
Only tax collection improved. The government collected 18 percent more in taxes and revenues in the first quarter, or around P408 billion.
Again, where is our money? Show us the money.