By Ben Rosario
The co-chairman of the House Economic Stimulus Cluster on April 27, Monday, warned against plans of government to cut infrastructure spending this year, saying that it should instead push for an “enhanced Build, Build, Build” strategy in the its bid for economic rebound.
Albay Rep. Joey Salceda (RTVM / MANILA BULLETIN FILE PHOTO)
“We estimate that every P200 billion in infrastructure can create up to 463,000 jobs on the year it is spent. Conversely, since government is now the sole driving force of demand, a P200 billion cut in infrastructure will (mean losing) 463,000 jobs on the year it is spent,” said Albay Rep. Joey Sarte-Salceda, the Lower House economic expert.
Salceda, also chairman of the House Committee on Ways and Means, said that “infrastructure remains one of the most powerful economic stimulus tools—especially if you can finish it on time.”
Salceda joined Speaker Alan Peter Cayetano and opposition Rep. Stella Quimbo in airing caution against cutting expenditure for infrastructure as part of government’s move to raise more funds to back the country’s fight against COVID-19.
The Department of Budget and Management believes that savings from the 2020 budget should be made in order to boost government’s anti-COVID-19 response for a longer period.
“As an output multiplier, it (infrastructure) is significant. It will also stave off part of the job losses we may incur because of COVID-19,” the senior administration solon stressed.
He explained: “The economic multiplier of infrastructure can be as high as 3.66, while its Year 1 multiplier can be as high as 1.02. This suggests that for every peso spent on infrastructure an additional peso is generated in consumption and investment.”
“As I said before, speed is your friend, delay is your enemy—in economics and in pandemic response. So we must prioritize mainly on the basis of speed,” Salceda said.
The Bicolano lawmaker called for the implementation of sectoral focus of “Build, Build, Build” on the following areas: health investments (especially for Universal Health Care), infrastructure supportive of creative industries, and Infrastructure for Public Schools of the Future.
“Infrastructure under enhanced BBB will complement the agriculture revitalization by establishing rural-urban linkages, enabling farmers to better access urban markets and services,” he said.