Gov’t  spending  must make up for lost quarter

Published May 18, 2019, 12:22 AM

by Charissa Luci-Atienza & Bernie Cahiles-Magkilat

 

e-cartoon-may-18-2019National  economic  growth in the first quarter (January-February-March) of this year was as predicted early this month by Socioeconomic Planning Secretary Ernesto Pernia.

It  dropped to  5.6 percent in these  first three months, the lowest in four years. It should have been 6.6 percent, if the national budget for 2019 had  been  approved  on time, he said. But  because  of  the  delay, the old budget for 2018 had to be used  for three months. During this period, the funds provided in the 2019 budget could not be used.

Thus  newly  hired  teachers  could not be paid their salaries by the Department  of Education. The Department of Interior and Local Government  could not begin its construction of new police stations and purchase of new equipment. The Department of Public Works and  Highways  (DPWH)  could not  start  the construction of so many projects funded under the 2019 budget.

The Senate finally sent the P3.7-trillion 2019 budget to Malacanang  on March 26  and President Duterte signed it into law on April 15 after vetoing some P95 billion in projects believed to be “pork barrel” included  by lawmakers.  But  by then,  the midterm election period was on, with the usual ban on public works projects.

Secretary  of Finance  Carlos Dominguez III said that during  this entire period, the government underspent  by over P1 billion daily. Total state spending  fell  by some  P75 billion  in the three-month period.

The drop in GDP to just 5.6 percent in the first quarter indicates how big a factor  government spending is in  determining it. Ideally, it would be best  if  private sector  spending  had a bigger role. But we are  moving in that direction, as  “Build, Build, Build” creates more roads and bridges, airports and seaports, and other infrastructures needed by commerce and industry to thrive and expand.

Now that  the 2019 national budget is finally in force, the national government will have to double its efforts to make up for the loss of those first three months of  the year.  It  will  have  to do in nine months  what it had planned to do in the 12 months of 2019.

We have full confidence that the DPWH under  Secretary  Mark  Villar will be able to carry out this heavy load.  We  hope  the other departments and agencies of the national government will similarly be able to  complete in  the next seven months what  would normally take 12 months to accomplish.

 
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