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Proposed FY 2018 General Appropriations Act

October 5, 2017

Sponsorship Speech of Senator Loren Legarda

Proposed FY 2018 General Appropriations Act

5 October 2017 | Senate Session Hall

Mr. President, esteemed colleagues in this Senate:

I humbly rise to present to you the 2018 General Appropriations Bill under Senate Committee on Finance Report No. 167.

This is an honor I am truly mindful about and for which I am deeply appreciative, for it is you, my distinguished colleagues, who reposed on this representation the trust to sponsor—for the last three years—this most important piece of legislation that we, as a collegial and independent institution, have to enact into law.

                                                                                          

It is for this reason that, as Chairperson of the Senate Committee on Finance, I am happy to report to the Senate that our task, mandated bySection 24, Article VI, of the Constitution, which is to “propose or concur with amendments” as regards the national budget for fiscal year 2018, is almost complete and is now ready for plenary discussion and the approval of our colleagues.

But before I go to the heart of the matter, please allow this representation to put into context the diligence and passion, if you may, that your Committee on Finance has poured into 48 budget hearings, 10 technical working group meetings, several budget briefings, and a comprehensive discussion at the Development Budget Coordinating Committee (DBCC) level, to assemble the 2018 national budget that I am about to present.

Mr. President, distinguished colleagues, there is one real and poignant encounter during one of the public hearings on the 2018 national budget.

It happened on 14 September 2017 when the Chairperson of the National Commission on Indigenous Peoples (NCIP), Leonor Oralde-Quintayo, waxed emotional when your Committee, upon the motion of Senators Juan Miguel Zubiri and Sherwin Gatchalian, approved the restoration of the NCIP’s budget, which the House of Representatives had reduced to only One Thousand Pesos (P1,000), together with the budget of an important Constitutional body, the Commission on Human Rights (CHR).

 

The significance of the moment was not lost to the NCIP officials because during the hearing, members of your Committee took turns in chastising them for their apparent lack of seriousness in their work. This representation herself rebuked the agency for its monumental failure, not only in defending the rights of our 14 million indigenous peoples[1], but also in promoting indigenous culture and knowledge. An agency, I said, that does not have the drive and passion to preserve IP culture and heritage needs a rap in the head to wake it up from its stupor. This was what the House of Representatives did by de-funding the NCIP.

 

Still fresh in my mind was the seemingly unabated and yet, unsolved killings of lumad leaders allegedly by para-military forces. I can remember a few of them, like Emerito Samarca, head teacher of an award-winning lumad school in Lianga, Surigao del Sur, and Dionel Campos and Juvello Sinzo.

 

These, as well as many other crimes buried and forgotten as statistics, are as repugnant as the admission by the NCIP top official that the incidence of poverty in the country remains high among IPs. As to what extent, the NCIP did not say, but if we juxtapose the IPs’ situation vis-à-vis the 21.9 million Filipinos who were considered poor in 2015[2], then what I just related speaks about the whole story of the 2018 General Appropriations Bill and its supreme importance and primacy to our national life.

The 2018 General Appropriations Bill is a national expenditure program touted by the administration of President Rodrigo Duterte to bring about inequality-reducing transformation, or pagbabago; a budget seeking to enhance the social fabric, or malasakit; one that will increase the country’s growth potential, or patuloy na pag-unlad; and an expenditure program that seeks to maintain the foundations for sustainable development.

Mr. President, esteemed colleagues, it is against these benchmarks that your Committee examined the 2018 General Appropriations Bill.

However, the over-riding constant that guided us in proposing refinements in the national budget proposal touches the very core of the question, “Will this budget effect real change among those who genuinely need the government’s preferential care and support—the 21.9 million poor Filipinos—the farmers, fisherfolks, children, self-employed and unpaid family workers, women, the youth, migrant and formal sector workers, senior citizens, and the urban residents who are unaffected by and oblivious to the rhetoric, the bureaucratic turf battles, the corruption, and the fake news breaking every single day?”

These basic sectors may not even know that the 3.767 Trillion Pesos the government is asking the Senate and the House to enact into a law is a deficit budget—meaning, that the disbursements to support this budget will total 3.364 Trillion Pesos, part of it, or 523.568 Billion Pesos, will be financed by borrowings, of which 80 percent will come from local sources and 20 percent from international lenders. They may not even know, but will undoubtedly worry if they do, that the bulk, or 84 percent, of the total disbursements will be sourced from both tax and non-tax revenues amounting to 2.841 Trillion Pesos.

And what of the poor? Will they, as we do, rage righteously that the Bureau of Customs, which had lately sunk lower than low in credibility, is to collect only 637.1 Billion Pesos in 2018, plus or minus the 165.5 Billion Pesos in tariff revenues[3] to be lost due to smuggling?

Mr. President, distinguished colleagues:

The serious work your Committee invested in fine-tuning the 2018 General Appropriations Bill has resulted in a budget that considered the wishes of the Executive Branch, yet reflective of what we—who, like the President, have a national constituency—feel daily as we keep in touch with the pulse of the people.

This pulse beats no farther than the steel gates of this Senate where every day, even during weekends, hundreds, if not thousands, of our fellow Filipinos from the lowest strata of society line up to avail of—nay, beg for—whatever assistance is available from the offices of the members of this hallowed institution.

A stark reality, that is: The Legislative Branch of government being a refuge of the poor because some agencies of the bureaucracy are either insensitive, unreachable, or sometimes failing to attend to their needs.

We want to help address the challenges that hinder agencies from fully utilizing their budget. Dahil sa pondo na ibinabalik sa kaban ng bayan, katumbas noon ay mga classroom na hindi naipatayo, mga kalsadang hindi nasimulan o nabuo, mga batang hindi nabigyan ng sapat na nutrisyon, mga pamilyang patuloy na naninirahan sa kalsada, mga komunidad na walang ilaw at tubig, at iba pang mga proyektong hindi naipatupad.

Faced with the grimmest of these realities, your Committee, thus, fashioned a budget that we believe will translate the soaring rhetoric of our leaders into something solid; into something firmly rooted on the ground that our people can hold on to—and hope.

It is a budget that reforms and transforms, to borrow the President’s message, but it is also a budget trimmed of the lavish, and therefore, unneeded, decorative furniture in a house meant for 104.9 million but which, unfortunately, accommodates only a few.

It means a budget that addresses the basics. It is a budget where we made room and space to keep those who are in the cold, warm; to feed those who are hungry and dispossessed; a budget that reduces enmity and restores the peace; a budget that is transparent.

Such a budget, your Committee believes, will bring the Filipino family tranquility, prosperity, and unity. We believe it will ignite hope, which is a dwindling currency in these pessimistic times. We also believe it is a crucial tool to finally break the cycle of inter-generational poverty and to promote inclusive economic growth for all Filipinos.

To reduce inequality, we at the Committee level supported many of the proposals of the President and the budget refinements proposed by our colleagues in the Lower House, but we also made sure those are aligned with the results of the Senate’s own consultations—the public hearings—that we conducted. That is the public pulse.

Mr. President, distinguished colleagues:

I begin with the environment and climate change, a life advocacy, as my public record shows.

Your Committee made certain that the 2018 General Appropriations Bill ensures ecological integrity, clean and healthy environment, risk-sensitive investments, and disaster preparedness through special provisions that integrate and mainstream disaster risk reduction and climate change adaptation and mitigation strategies in government programs. We at the Committee firmly believe that building an inclusive and prosperous economy requires us to continually strengthen our resilience to impacts of natural hazards and climate change.

If you recall, Mr. President, distinguished colleagues, we embedded the Quick Response Fund (QRF) all in the budget of the National Disaster Risk Reduction and Management (NDRRM) Fund in 2017, only earmarking those that were meant for the agencies. In this 2018 General Appropriations Bill, we reverted—as practical logic dictates—to an arrangement that we instituted in the 2016 GAA, where the QRF is lodged in individual agencies to ensure quick access and utilization when the need arises.

Thus, your Committee transferred 1.250 Billion Pesos from the NDRRM Fund to the Department of Social Welfare and Development (DSWD); One Billion Pesos each to the Department of Agriculture (DA) and the Department of Public Works and Highways (DPWH); 750 Million Pesos to the Armed Forces of the Philippines (AFP); 500 Million Pesos each to the Department of Health (DOH), Office of Civil Defense (OCD), and National Irrigation Administration (NIA); and 100 Million Pesos to the Department of Energy’s (DOE) National Electrification Administration (NEA). We also allocated Two Billion Pesos QRF to the Department of Education (DepEd), 500 Million Pesos of which is from the NDRRM Fund.

We support the Executive Branch’s proposal to provide 1.5 Billion Pesos for the PAGASA Modernization Program; 1.5 Billion Pesos for the Metro Manila Development Authority’s (MMDA) flood control program; and 285 Million Pesos to the Mines and Geosciences Bureau (MGB) of the Department of Environment and Natural Resources (DENR) for geo-hazard mapping and assessment. We agree that these resources are direly needed to strengthen our communities’ adaptive capacities for climate change.

And to further underscore this need, we require, under this 2018 General Appropriations Bill, every local government unit, under the responsibility of the Department of Interior and Local Government (DILG), to conduct regular evacuation drills in coastal communities that are at risk of storm surges and landslides.  These drills should simulate real emergencies and should teach our people basic survival skills; how to avoid panic; as well as help them ascertain proper responses during actual natural hazards.

On the main, while the House re-aligned funds from other agencies to come up with 40 Billion Pesos for Republic Act No. 10931, the Universal Access to Quality Tertiary Education Act, which the President signed last August 4, your Committee further allocated Ten Million Pesos in capital outlay for each of the country’s 112 State Universities and Colleges (SUCs) simply for the reason that free college tuition alone does not make education accessible. School facilities, such as classrooms, laboratories, equipment, and efficient and well-trained teaching personnel, do.

And to support increased enrollment in Science, Technology, Engineering, Agri-Fisheries, and Mathematics (STEAM) courses, which is now noticeable, we have re-aligned 327 Million Pesos within the budget of the Department of Information and Communications Technology (DICT) for free Wi-Fi for all SUCs. Global inter-connectivity should extend from the homes to the schools, then on to the workplaces.

For basic education, we have increased the Chalk Allowance for teachers from Two Thousand Five Hundred Pesos (P2,500) to Three Thousand Five Hundred Pesos (P3,500), all amounting to 770 Million Pesos, to sustain the increases we started in 2015. Our instruction to the Department of Budget and Management (DBM) and the DepEd is to release this allowance before the start of classes in 2018.

We continue to support the efforts of the DepEd for the conservation and preservation of all remaining Gabaldon-type school buildings and other similar heritage sites, as well as its site development plans. Thus, in the 2018 national budget, we have allocated the amounts of One Billion Pesos and 435 Million Pesos, respectively, for each of these priorities.

Mr. President, distinguished colleagues:

The budget we fashioned out is a budget of continuity and sustainability. In 2017, we overwhelmingly supported PhilHealth with additional Three Billion Pesos budget so that all Filipinos can be covered by the government’s Point-of-Service Program. We are providing PhilHealth the same amount for 2018. We ask PhilHealth to aggressively inform the needy of our country of this health subsidy.

Also in 2017, we set aside Two Billion Pesos in irrigation fees subsidy so that the National Irrigation Administration (NIA) will no longer collect irrigation fees from farmers’ associations. We earmarked the same amount for the same priority in the 2018 budget. My hope is that next year, when the NIA comes back to report to us the use of the money, it will tell us that the 34.3 percent poverty among our farmers, the poorest among the basic sectors, would have been significantly reduced.

In this budget for next year, we reflected our continuing effort to reduce the inequality that victimizes the poor by setting aside Two Billion Pesos for the repair, rehabilitation, and construction of DSWD centers nationwide. This amount became available after the DSWD’s internal housekeeping, which saw it realign One Billion Pesos from its Sustainable Livelihood Program, and another One Billion Pesos added by the Committee.

After the repair, rehabilitation, and construction are done, we expect the Department to make available at these centers the services of a respectable shelter: access to water and electricity, working toilets, beds, proper ventilation, adequate lighting, and other essentials. We expect nothing extravagant; just what is basic and humane. We have to treat our poor with dignity.

We continue to support the Conditional Cash Transfer Program by upholding its 89.408 Billion Pesos allocation, of which 31.68 Billion Pesos is for rice subsidy.

For 2018, an amount of 270 Million Pesos for the Early Childhood Care and Development/Nutrition Package for the First 1000 Days have been set aside under the National Nutrition Council that will benefit children and adults in 16,419 barangays worst-hit by malnutrition. This is a timely intervention to address the 31.4 percent poverty rate among the Philippines’ children population, the third highest among the basic sectors.

For the second year in a row, we are funding the Centenarians Act by allocating 189.5 Million Pesos for a one-time cash grant of One Hundred Thousand Pesos each to 1,895 senior citizens aged 100 years and over. For the surviving spouses of our World War II veterans, your Committee has allocated 1.647 Billion Pesos for the full—not partial—payment of total administrative disability arrears, a shameful ingratitude to those who shed sweat and blood and sacrificed lives so we may live in liberty and freedom. In addition, we set aside 30 Million Pesos for the construction of a hospital in Mindanao for our dwindling number of veterans.

We support the proposition of the President that this budget is one that will increase the country’s growth potential, or patuloy na pag-unlad. This being so, we followed through our support of One Billion Pesos this year to the government’s Pondo Para sa Pagbabago under the Small Business Corporation by setting aside the same amount for 2018 to boost the continuous development of micro, small, and medium enterprises (MSMEs) which comprise the largest bulk of enterprises in the country.

Relative to this, we added 800 Million Pesos to the House-approved 200 Million Pesos for the provision of shared services facilities (SSFs). SSFs are development support equipment and systems that would be made available to MSMEs to make them productive and competitive. Of the One Billion Pesos for SSF, 200 Million Pesos will be for SUCs that implement livelihood initiatives; 100 Million Pesos will be for Schools of Living Traditions (SLTs); and 50 Million Pesos for MSMEs affected by the war in Marawi.

We are one with the President and our colleagues in the Lower House in batting for increased infrastructure spending to herald the so-called Golden Age of Infrastructure. Aside from stimulating economic activity—estimated at a GDP growth of 7-8 percent  in 2018; creating decent jobs, expected at 1.6 million annually; and attracting more investments, the “build, build, build” philosophy will ultimately expand to building human capital and inclusive social justice. Thus, we support the budgets of the agencies with hard infrastructure requirements, 30 percent in total of the 2018 national budget.

And as one of the safeguards against waste of public funds, in this Bill, we are writing a new special provision that requires all government agencies with infrastructure projects to post in their official websites the status of such projects, including geo-tagged photos, contractors’ names, projects’ cost and location, and projects’ start and target date of completion.

Speaking of Marawi, we support the move of the House to provide for the rehabilitation of the city, but we were firm in our stand that the budgetary allocation should be increased. Thus, in the the light of Marawi City’s current situation, we are making available Ten Billion Pesos of the National Disaster Risk Reduction and Management (NDRRM) Fund for 2018 for the city’s quick recovery, reconstruction, and rehabilitation.  This amount is on top of the Five Billion Pesos given this year from the Contingent Fund and funds of different government agencies.

 

We are also making available a 500-Million-Peso subsidy for a loan facility for Marawi residents, under the auspices of the Land Bank of the Philippines (LBP), to enable them to re-construct their damaged houses. In a new special provision, we specify that such loans will be free of interest, but the loanable amount is limited to Two Million Pesos per household and the Land Bank may charge the borrower an administrative cost for processing the loan.

 

For the Mindanao State University (MSU) in the City, we have allocated Five Million Pesos more for cultural mapping of the intangible and tangible heritage—all memories and materials left by the war that engulfed Marawi. We hope that this process of heritage mapping and its intended outputs can hasten the psychological healing of the affected populace and strengthen our cultural bonds with our fellow Muslim Filipinos. These budgets go with our fervent prayer that we may immediately see hope, dignity, and peace restored in Marawi City and other affected areas.

 

With this small, yet meaningful, allocation, we signal to all Filipinos that the Senate accords culture and the arts an important place in our budget priorities and would not allow cultural agencies—which provide nourishment to our national soul and identity—to be left behind. Thus, your Committee provided resources for the promotion and preservation of our tangible and intangible heritage. The message we are sending is that culture and arts literacy is key to national unity.

 

Mr. President, esteemed colleagues:

 

The Marawi crisis brought us constructive lessons in peace-making and peace-building. It also magnified a thousand times the hard challenges we face towards socio-economic and political stability. And so, we do not desire another Marawi crisis somewhere else in our land. Thus, for 2018, we are providing an additional 100 Million Pesos intelligence fund for the National Intelligence Coordinating Agency (NICA) to ensure that it is ready and equipped in preventing any more Marawi-like crises from happening.

 

This is on top of the intelligence resources we are allocating the Armed Forces of the Philippines (AFP) and the Philippine National Police (PNP), as well as the 36 Million Pesos  and 35 Million Pesos in confidential funds and the situation room funds, respectively, for the National Security Council (NSC).

Despite the criticisms and the public ire hurled against the PNP, we support its funding needs because only through this can we really make them more well-equipped, efficient, and effective. Your Committee does not subscribe to some wild notion that withholding resources from our police force will make them accountable. It is the PNP leadership under the President who should answer for the action, behavior, and performance of the police corps.

 

Thus, we are allocating 1.9 Billion Pesos to the PNP in 2018 for it to achieve an improved police-to-population ratio of 1:511.[4] About 10,000 Police Officer 1 recruits will benefit from this budget. We allocated 900 Million Pesos to the PNP to support its campaign against illegal drugs, as well as 1.2 Billion Pesos for the operating requirements of the Philippine Drug Enforcement Agency (PDEA).

 

By way of support to PNP operations, we are also providing 100 Million Pesos for the purchase and installation of closed-circuit television (CCTV) for the PNP Command Center, as well as an initial 50 Million Pesos for the acquisition of body cameras for police officers in highly-urbanized areas. We are setting aside 47.734 Million Pesos to finance the upkeep of the PNP Women and Children Center.

 

For our armed services, your Committee has crafted a new provision for the un-programmed appropriation of Two Billion Pesos which shall be used exclusively to support the requirements of the AFP/PNP Housing Project under Republic Act Nos. 7279 and 7835. Every soldier and police officer, though his or her work may be on the field and outdoors, need a shelter to go home to, as much as we ordinary citizens do.

 

Your Committee has increased from Two Thousand Pesos (P2,000) to Four Thousand Pesos (P4,000) a month the hazard pay for the men and women of the National Bureau of Investigation, or 13.536 Million Pesos, knowing the risks that they take in performing their duties and responsibilities.

 

For the Philippine Coast Guard, we provided an additional 120 Million Pesos for the installation of buoys in coast guard stations nationwide to ensure safety at sea, especially in the eastern seaboard. While minuscule in amount, this action is part of our efforts to secure the Philippine Rise, or Benham, and signals to the world, particularly to our neighbours in Asia, that we have the political will to assert the integrity of and our sovereignty over Philippine territory.

 

Likewise, your Committee has allocated 8.2 Million Pesos more for the hazard pay of Department of Foreign Affairs (DFA) employees in hardship posts, which are increasing in number given the very volatile socio-economic and political situation in many parts of the globe that has engendered problems like terrorism and transnational crimes and diseases. Our diplomatic personnel should be well-protected as they respond to the challenges of their official representation of the Philippines as an active member of the international community.

 

To ensure a more efficient judicial system, we are providing additional 426 Million Pesos for the Sandiganbayan for next year. The amount is inclusive of the Ten Million Pesos rewards fund for whistleblowers. In this budget, the Supreme Court gets an increase of 100 Million Pesos, and the Court of Tax Appeals and Court of Appeals, Two Million Pesos each.

 

The following constitutional offices also get their fair share in the form of increases in their 2018 budgets: Civil Service Commission (CSC), 71.870 Million Pesos; Commission on Audit (COA), 40 Million Pesos; Commission on Human Rights (CHR), 156.432 Million Pesos, on top of its restored budget; and the Office of the Ombudsman, 143.653 Million Pesos, specifically for the implementation of the electronic filing of Statement of Assets, Liabilities, and Net Worth, or E-SALN, of government officials and employees, worth 16.653 Million Pesos, and for its building, 127 Million Pesos.

 

Mr. President, distinguished colleagues:

 

I could not have completed the serious, but fulfilling, task of fine-tuning the 2018 General Appropriations Bill without the company of our hardworking vice chairpersons—Senators Sonny Angara, Bam Aquino, JV Ejercito, Ping Lacson, and Cynthia Villar—to whom this representation is sincerely thankful and grateful, not only for their meticulous employ of their own fine-toothed combs in asking the relevant questions on the budget, but also for their diligence and wit. I should not miss to mention all our distinguished colleagues who participated in our public hearings.  All of you, here in this Chamber, have surely enriched our discussions, and you deserve our people’s commendation.

 

Mr. President, distinguished colleagues:

 

The Filipino people are awaiting with nervous anticipation and hope the translation of the outcomes of the Duterte Administration’s budgetary proposal into meaningful, tangible, and real life-affecting reforms, as well as solid benefits. As Chairperson of your Committee on Finance, I myself, am getting impatient for results and watching closely how things will change for the better for our people. This must be fast and sooner, I often tell myself.

 

Yet, as elected Senators, duty dictates that we, as members of a collegial institution, must show the way in “drinking tea from an empty cup”, the highest degree of patience as Confucius himself taught. This is what we do in a democracy. We adhere to certain rules, processes, and systems in our work to prevent disorder, if not chaos.

 

And this adherence to rules, processes, and systems applies to our work in the national budget. We must “propose or concur with amendments” as the Constitution instructs us.

 

This is why today, on behalf of your Committee on Finance, I propose for the Senate’s approval of and concurrence with the 2018 General Appropriations Bill, as thus presented under Senate Committee on Finance Report No. 167:

 

Programmed New Appropriations – Two Trillion, Seven Hundred Eighty-Six Billion, One Hundred Eighty-Seven Million, Five Hundred Fifty Thousand Pesos (P2,786,187,550,000)

 

Unprogrammed Appropriatons – Seventy-Five Billion, Three Hundred Forty Million Pesos (P75,340,000,000)

 

Total New Appropriations – Two Trillion, Eight Hundred Sixty-One Billion, Five Hundred Twenty-Seven Million, Five Hundred Fifty Thousand Pesos (P2,861,527,550,000)

 

Mr. President, I now make myself available to answer any question from the distinguished members of this Chamber.

 

Thank you, Mr. President.

 

END

 


[1] NCIP: 14,184, 645

[2] Poverty Among the basic Sectors in the Philippines. Sources of Basic Data: Merged 2015 Family Income and Expenditure Survey and January 2016 Labor Force Survey.

[3] Estimate of losses in potential annual BOC revenues due to smuggling, according to The President’s Budget Message, “A Budget that Reforms and Transforms”. However, a BOC Frequently Asked Questions document places the annual potential revenue losses at a high of P200 billion, or P547 million per day.

[4] The ideal police to population ratio is 1:500