REPORTS of the sustained government underspending bolster the observation that the economy is growing despite President Benigno “Noynoy” Aquino 3rd.
On Monday, the Department of Finance released data showing that in the first quarter of 2015, public spending once again fell short. This is a concern because public spending is a major component of GDP.
The economy has been growing at a fast pace, but, as the data have been showing, no thanks to the Aquino government. The point is not who gets the credit, but who benefits–which should be ordinary Filipino consumers.
The Asian Development Bank (ADB) credits private spending for more than 60 percent of the GDP growth. President Aquino and his men should not have ignored the fact that the economy would have been stronger if the government did its job better. An even stronger economy could mean more programs to alleviate poverty, or more infrastructure projects to ease traffic congestion and make public transportation safer. And also more funds to improve military capacity so it can mount a minimum credible defense.
Instead of doing their work better, President Aquino’s economic managers have been laboring to spin the news. They harp on the declining deficit, which narrowed 60 percent in the first quarter, and practically zero inflation, which presently stands at 2.8 percent. But the reality is that the government must do much more. The President and his economic team have promised to do much better than the past administration, but in the five years of Aquino as president we have yet to see evidence of it.
So, where is all that unspent money?
We hope that it does not go to “savings” as defined by Budget Sec. Florencio “Butch” Abad. We hope that it does not go to programs that have replaced the Disbursement Acceleration Program (DAP), which has been ruled as unconstitutional by the Supreme Court. Worse, we hope that no unspent government funds are funnelled to the so-called pork barrel or whatever technical name it is now known by.
As we have said before in this space, we hope that more public funds are spent on hastening the repair, rehabilitation, and expansion of the country’s rail system. That kind of public infrastructure program would not only boost jobs, but also help ease traffic congestion, which one study said costs the Philippines P576 billion a year.
We hope that the government further increases its budget for education, especially now that the K to 12 program is in its fifth year of implementation. We hope that the government can further increase its funding for scholarships so that more poor students can have access to education. At the same time, an even bigger education budget would allow institutions to cover the investments needed to improve overall quality and competitiveness.
Also, public investments in education need to go beyond the basic level. The Philippines has fewer masteral and doctoral graduates compared to other Asean countries, like Thailand, Malaysia, and even Indonesia. According to the Commission on Higher Education (CHED), more than 50 percent or about 70,000 college professors need to upgrade their qualifications and competencies. The government does have a program for faculty development, but like in many other things, more needs to be done.
The lack of funds used to be the generic reply to why the government is not doing what it is supposed to do. Now the government cannot even disburse what has already been budgeted. What a mess!
Is this due to incompetence or a manic aversion to do what must be done?