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Sponsorship Speech: Proposed National Budget for Fiscal Year 2016

November 23, 2015

Sponsorship Speech of Senator Loren Legarda
Proposed National Budget for Fiscal Year 2016
23 November 2015 | Senate Session Hall

Mr. President, Distinguished Colleagues,

I rise to sponsor the proposed national budget for 2016.

Foremost, I wish to dedicate this budget to all the victims and survivors of disasters, whether caused by natural hazards, such as typhoons Yolanda and Lando, among many others, or man-made tragedies such as the Zamboanga siege and the abuse and displacement of our Lumads.

This budget will cover two administrations—that of the outgoing President Benigno Aquino III and the incoming president who will be elected in May 2016. Thus, the continuity of programs that will be funded under this proposed budget must be ensured.

Mr. President, this budget is not budget as usual. For many years now I have been consistently advocating for a paradigm shift in the way we do governance and how we promote development.

Faced with the threats of climate change, extreme weather events are now the new normal, we cannot be victims as usual, so we cannot have a budget as usual. We need a budget that not only responds to the basic needs of our citizens but also proactively addresses the risks that threaten the very basic needs we aim to provide our people. We need a budget that reduces and manages existing risks and prevents the creation of new risks.

I believe you will no longer disagree with me when I say that climate change is one of the greatest challenges the world is facing today. Developed nations know this—France, which is the host of this year’s climate change conference, Germany, which has led the way in renewable energy, and even the United States, which is one of the top emitters of greenhouse gases. They have been initiating measures towards energy transition, cutting down fossil fuel consumption to favor clean energy sources.

Our own government has committed to reduce GHG emissions to 70% by the year 2030 with the financial and technical support from other nations.

Your Committee on Finance has worked to make the 2016 national budget proactively address the impacts of climate change and extreme weather events. Programs, projects and activities for disaster risk reduction (DRR) and climate change adaptation and mitigation (CCAM) lodged in different agencies of government amount to Eighty-Seven Billion Nine Hundred Thirty-Five Million Eighty-Seven Thousand Pesos (Php87,935,087,000) or 4.11% of the total new appropriations under the General Appropriations Bill (GAB). This is still a small percentage, an indication that we have not totally mainstreamed disaster resilience and climate adaptation in government programs. Thus, we have included special provisions that will integrate DRR and CCAM in the programs of government.

It is also worth noting that the government has increased allocation for infrastructure projects, such as irrigation, road and transport networks and housing, which, at 766.3 Billion Pesos, hits the benchmark five percent of the Gross Domestic Product (GDP). We have included special provisions in the budget to ensure the construction of safe and resilient infrastructure.

We have worked to align the budget with the new sustainable development goals (SDGs). We do not expect it to be able to achieve the global targets yet because the objectives must be incorporated by the agencies themselves when they work on their respective budget proposals. Thus, this early, we urge all agencies of government to align their budget for 2017 with the SDGs. We must all be forward-looking and think long-term lest we remain forever a developing nation.

We have worked to make this a budget that will promote inclusive growth. We have provided very specific line items that are responsive to the needs of fisherfolks and coastal communities, farmers, rural folks, indigenous communities. We introduced amendments that will support 4th, 5th and 6th class municipalities and barangays in the country.

House version

Mr. President, the proposed national budget for fiscal year 2016 amounts to 3.002 Trillion Pesos. From this amount, Automatic Appropriations under the National Expenditure Program is worth 930.7 Billion Pesos.

On November 10, 2015, the Senate received House Bill No. 6132. New Appropriations is worth Two Trillion One Hundred Thirty-Eight Billion Six Hundred Four Million Five Hundred Ninety-Six Thousand Pesos (Php2,138,604,596,000), which is divided into Programmed Funds amounting to Two Trillion Seventy-One Billion One Hundred Four Million Five Hundred Ninety-Six Thousand Pesos (Php2,071,104,596,000) and Unprogrammed Funds worth Sixty-Seven Billion Five Hundred Million Pesos (Php67,500,000,000).

The House has introduced a provision which states that the availability of appropriations for Maintenance and Other Operating Expenses (MOOE) and Capital Outlay (CO) will be for two years. The Senate supports this amendment.

Senate version

Your Finance chairperson, along with six vice chairpersons, has diligently conducted hearings and technical briefings with the agencies of government to extensively discuss and scrutinize all budget proposals.

In contrast to the House version, the Senate has proposed New Appropriations worth Two Trillion One Hundred Eighteen Billion Six Hundred Four Million Five Hundred Ninety-Six Thousand Pesos (Php2,118,604,596,000), which is Twenty Billion Pesos less in Unprogrammed Funds.

As mandated by the Constitution, the Department of Education (DepEd) receives the highest budgetary priority. We have allocated Four Hundred Eleven Billion Four Hundred Eighty-Two Million Seven Hundred Eighty-Nine Thousand Pesos (Php411, 482,789,000) for DepEd. This is more than 15% of its budget for 2015 because the implementation of the senior high school curriculum under the K-12 program begins next year. Thus, the budget includes allocation for construction of classrooms and hiring of additional teachers.

I wish to highlight, Mr. President, an important amendment we have introduced in this budget. We have deleted all provisions referring to the budget priorities framework that authorizes department heads to reallocate funding because only the Congress has the power to approve fund allocations for government programs.

In line with your Finance Chair’s vision of transforming the 2016 national budget into a climate and disaster resilient, risk sensitive, gender responsive, socially inclusive and sustainable budget, we have proposed budget amendments and introduced changes to the general and special provisions of the General Appropriations Bill. We wanted to be as specific as possible to show that every agency is capable of using its resources towards building sustainable, resilient and inclusive communities.

Promoting inclusive growth

Support for farmers, fisherfolks, rural livelihoods and small entrepreneurs are evident in many of our proposed allocation.

The amount of 100 Million Pesos is allocated for the implementation of the Barangay Kabuhayan Act under the Technical Education and Skills Development Authority (TESDA). Livelihood and skills training centers will be established in 4th, 5th and 6th class municipalities for employment generation. We also included a special provision under TESDA’s budget to include traditional skills in their non-formal technical vocational education and training.

We have allocated 100 Million Pesos each for the Department of Trade and Industry’s (DTI) One Town, One Product (OTOP) and Shared Service Facility (SSF), and Ten Million Pesos for Regional Trade Fairs and Exhibitions—programs that support our micro, small and medium enterprises (MSMEs).

Senator Bam Aquino also included an allocation for the establishment of Negosyo Centers to promote ease of doing business and facilitate access to services by MSMEs, as well as funding for trade and investment promotion services of the DTI.

Senator Cynthia Villar boosts government support for the agriculture and fisheries sectors through funding for programs of the Department of Agriculture (DA) such as the Provision of Agricultural Equipment Facilities (PAEF) and Extension Support Education and Training Services, Supply Services, and Establishment of Technology Demonstration, which will provide equipment and training support for our farmers and fisherfolks.

Senator Sonny Angara has introduced funding for the newly amended Public Employment Service Office (PESO) Act and for Rural and Emergency Employment Services program of the Department of Labor and Employment (DOLE).

Moreover, Three Billion Four Hundred Million Pesos (Php3,400,000,000) is appropriated for the Development Bank of the Philippines (DBP) as equity contribution of the national government and shall be used exclusively for the extension of loans to qualified MSMEs; while Six Billion Five Hundred Million Pesos (Php6,500,000,000) is appropriated for the Land Bank of the Philippines (LBP) as equity contribution of the national government and shall be used exclusively for the extension of loans to qualified farmers and fisherfolks.

Strengthening public safety and social welfare programs

In strengthening the government’s capacity to provide social services to our citizens, we have the following proposed allocations:

Allocation for the conditional cash transfer (CCT) program for 2016 is worth 62.67 Billion Pesos that will support 4.40 million households under the Regular CCT and 218,377 households under the Modified CCT.

We have also introduced a special provision under the CCT. If we are to end the cycle of poverty and disasters, we must equip our citizens, especially the poor, with the know-how and capacity to be resilient and prepared against disasters. Thus, in the conduct of family development sessions among CCT beneficiaries, the Department of Social Welfare and Development (DSWD) shall integrate in its program the protection of the environment, disaster risk reduction and climate change adaptation and mitigation, including the preservation of the indigenous culture of their locality. The DSWD shall also conduct capacity building programs to prepare its beneficiaries for the onset of natural hazards.

Moreover, in the implementation of the sustainable livelihood program, the DSWD shall converge with the National Commission for Culture and the Arts (NCCA) for the CCT beneficiaries to be taught skills training under the schools of living traditions (SLTs), when applicable.

We have also allocated funds for the completion of assistance to victims of past natural calamities and crisis. This fund, under DSWD, is worth One Billion Six Hundred Thirty-Three Million One Hundred Thirty Thousand Pesos (Php1,633,130,000) for Typhoon Yolanda victims, and worth Fifty-Eight Million Eight Hundred Seventy-Nine Thousand Pesos (Php58,897,000) for families affected in the Zamboanga siege.

For our elderly population, Senator Ralph Recto has proposed an increase of Two Billion Eight Hundred Eighty-Seven Million Seven Hundred Thirty-Three Thousand Pesos (Php2,887,733,000) in allocation for social pension of indigent senior citizens under the DSWD budget.

Moreover, the 2016 budget for Philhealth premium subsidies is worth 43.8 Billion Pesos, which will cover 15.4 million families and 2.8 million poor senior citizens.

Meanwhile, we support the House’s allocation of 4.773 Billion Pesos for the payment of the total administrative disability (TAD) pension for surviving spouses of deceased World War II veterans and partial payment for TAD pension for living post-war veterans who are at least 80 years of age as of 2016. This is long overdue. Our war veterans have served our country well by putting their lives on the line and it is a shame for a nation not to honor its valiant soldiers with adequate and timely compensation.

Further, we must strengthen our support for our defense forces especially with continuing threats to our territorial integrity, such as the dispute over the West Philippine Sea (WPS). The continuing modernization of the Armed Forces of the Philippines (AFP) should be sufficiently supported and funded without delay. For 2016, funding for the Revised AFP Modernization Program amounts to 25 Billion Pesos.

In terms of law enforcement and public safety, we have to ensure the swift dispensation and resolution of cases filed in our courts. Thus, the government has increased the budget for the Judiciary over the years. The 2016 proposed budget for the Judiciary is 26.68 Billion Pesos, which is 27% higher than its 2015 budget.

Meanwhile, a budget of 12.9 Billion Pesos was earmarked for the Department of Justice (DOJ)—3.25 Billion Pesos of which is for law enforcement, as the agency aims to increase the rate of prosecutions to at least 75%; while 236.4 Million Pesos is for the Witness Protection Program to accommodate additional state witnesses.

Among other noteworthy appropriations are the funding for the rehabilitation and construction of dormitories under the University of the Philippines System (UPS).

Senator TG Guingona also included funding for the modernization of the Philippine Normal University (PNU) and for continuous training programs for teachers so we can create a pool of qualified and world-class educators.

Your Committee, Mr. President, is strongly considering to add capital outlay of Five Million Pesos for each SUC during the period of amendments. This is in support of our SUCs in their research programs and in building needed infrastructure.

Senator Serge Osmeña increased the budget for consultancy services for the Energy Regulatory Commission (ERC) to cover expected expansion of monitoring operations of the ERC’s Market Operations Service and assistance in the review and revision of the relevant rules for Distribution and Transmissions Wheeling Rates setting and Rules for Power Supply Agreements.

Strengthening cultural integrity

In line with our duty and commitment to ensure that our cultural integrity remains intact, we have allocated funds under the National Commission for Culture and the Arts (NCCA) for three major programs, namely: (1) Preservation and promotion of tangible and intangible Filipino Heritage through research, documentation, publication, promotion, exhibition and film production; (2) Scholarships and grants, such as funding for schools of living traditions, among others; and, (3) Cultural and heritage mapping projects.

We have introduced a special provision that prohibits the alteration, renovation or demolition of government buildings and open spaces declared by government cultural agencies or presumed to be important cultural properties without prior approval of the government cultural agencies and proper consultation with stakeholders and cultural groups to be administered by the NCCA, including the protection of the sight line with regard to built heritage, cultural properties and cultural landscapes.

In undertaking major infrastructure projects, the concerned department or agency shall be responsible specifically in the planning, design, construction, and maintenance of national roads and bridges as they impact on heritage structures or aspects of heritage conservation pursuant to RA 10066 or the National Cultural Heritage Act of 2009.

We also aim to strengthen the cultural diplomacy programs of the Department of Foreign Affairs (DFA). I am happy to announce that we have successfully returned to the 2015 Venice Art Biennale after 51 years of absence. Our Philippine Pavilion did not disappoint even international art critics and was featured in various local and international art reviews. It has opened doors of vast opportunity for Filipino artists. We have appropriated funds in the DFA for the country’s participation in the next Art Biennale in 2017 and for the 2016 Venice Architecture Biennale, which is historic as well because it will be our first time to have a national pavilion therein.

Building resilient and sustainable communities

Finally, Mr. President, the bulk of amendments and new provisions we introduced for the 2016 national budget is aimed towards our goal of ensuring the resilience of our communities to natural hazards and climate change.

The amount of 100 Million Pesos is provided under the Department of Environment and Natural Resources (DENR) to support the National Solid Waste Management Commission, a long ignored agency, in its capacity building programs for local government units (LGUs) for the implementation of the Ecological Solid Waste Management (ESWM) Law.

The protection of our marine ecosystems should likewise be a priority of government. The Philippines has 240 million hectares of marine area based on the 200-mile exclusive economic zone (EEZ), in contrast, the country’s land area is only 30 million hectares. We are a maritime nation, but we do not act like one as only five percent of our coral reefs are in good condition. We have urged the DENR to immediately address the worsening state of the country’s marine ecosystems by creating a major program for coral restoration just like the National Greening Program. Thus, we have allocated 500 Million Pesos for the National Coral Restoration Program.

Under the Climate Change Commission, we have allocated 50 Million Pesos for the creation of the Center for Climate Resilience in Clark Green City. This is a counterpart of a technical grant from the German government.

We are also funding capacity building programs of the CCC for local disaster risk reduction and management offices, as well as clean energy promotion programs of the Department of Energy’s (DOE) National Renewable Energy Board (NREB) and Renewable Energy Management Bureau (REMB).

Among the amendments and new provisions we introduced are as follows:

• Critical public infrastructure must be designed and built to be resilient to earthquake, typhoon, flood and other extreme weather events.

• In retrofitting bridges and other public infrastructure, the government shall give priority to areas considered to be highly vulnerable to seismic activity.

• All agencies and corporations that have supervision over the major dams shall ensure that dams under their respective jurisdiction are properly maintained, managed and operated with updated and promulgated protocols that take into account climate change and extreme weather events and ensure coordination with PAGASA on precipitation forecast, and with efficient and functional water level monitoring system. The agencies concerned shall also establish and maintain an efficient and effective early flood warning system that is periodically tested together with the local government units and communities at risk of flooding from dam water releases.

• The Department of Agrarian Reform (DAR) must provide support to all agrarian reform communities (ARCs) for them to be attuned to climate change adaptation and disaster risk reduction.

• The DA should increase the resilience of agricultural communities through the implementation of disaster-resilient agricultural infrastructure projects, distribution and development of seeds that are optimally adaptive to present and to future climate conditions, and conduct seminars and trainings for LGUs.

• Disaster risk reduction (DRR) and climate change adaptation and mitigation (CCAM) programs must be in line with the Sendai Framework for Disaster Risk Reduction 2015-2030, the Philippines’ Intended Nationally Determined Contributions (INDC) submitted in relation to the United Nations Framework on Convention on Climate Change (UNFCCC) 21st Conference of the Parties, and the Sustainable Development Goals (SDGs), pursuant to the Climate Change Act of 2009, as amended by the People’s Survival Fund Act of 2012, and the Philippine Disaster Risk Reduction and Management (PDRRM) Act of 2010.

• All government agencies and offices and LGUs must earmark a portion of their budget to ensure that protection of biological diversity is integrated and mainstreamed into their development projects and programs.

• All national government agencies, LGUs and government owned and controlled corporations are urged to embark on energy efficiency measures and adopt the use of energy efficient lighting in their office buildings, and other public buildings and public places.

• The DENR, in the selection of planting sites for the National Greening Program (NGP), shall give priority to communities ravaged by extreme weather events and the planting materials shall be responsive to the needs of the said communities.

• In building education facilities and acquiring new school sites, the DepEd must have design plans that are environment-friendly and consider the geo-hazards in the location of these facilities.

All public schools must install rainwater collection systems and a materials recovery facility in a suitable open space within the school premises. Public schools with available lands must establish a vegetable garden.

The DepEd must also endeavor to preserve and restore the existing Gabaldon school buildings and other heritage school buildings as part of the preservation of the country’s cultural heritage. No Gabaldon school building and other heritage school building shall be demolished.

• SUCs, in coordination with the LGUs, shall include in its research program the mapping and inventory of the biodiversity of the province where the main campus of the SUC is located.

SUCs must also coordinate with the DENR in implementing the NGP, primarily through the establishment of clonal nurseries, the conduct of forest research, and mangrove reforestation activities.

• DepEd and SUCs must integrate the following in their respective curricula: environmental protection and awareness, disaster risk reduction, climate change adaptation and mitigation, indigenous knowledge systems pertaining to agriculture, environment and cultural heritage. The Department of Interior and Local Government (DILG) meanwhile should embark on a massive information campaign for LGUs on the said issues.

• The DILG should assist LGUs in the development of the comprehensive land use plan and in enacting the appropriate zoning ordinances. It must also ensure that all LGUs have a local disaster risk reduction and management office (LDRRMO) pursuant to the PDRRM Act; and a council whose purpose is the promotion of culture and the arts in all provinces, cities and municipalities, pursuant to the Local Government Code.

• LGUs, in coordination with the National Housing Authority (NHA), shall implement the relocation and resettlement of persons living in danger areas. Resettlement sites must have basic services and facilities and access to employment and livelihood opportunities sufficient to meet the basic needs of the affected families.

The barangay, municipal or city government units shall prevent the construction of any kind of illegal dwelling unit or structures within their respective localities.

• The Department of Public Works and Highways (DPWH), in controlling soil erosion and slope stabilization in the construction of roads, shall give priority to the use of coconet bio-engineering solution in areas where there is available supply and the cost of coconet bio-engineering solution is equal to or cheaper than the conventional slope protection materials.

The DPWH shall include in the design and program cost of road construction projects the planting of trees on both sides of the roads. It shall also prescribe the design of rainwater catchment systems to be installed in public areas.

• It is the responsibility of the DILG and the DPWH to ensure that evacuation centers are built on safe sites and designed to withstand wind speed of three hundred (300) kilometers per hour and moderate seismic activity of at least 8.0 magnitude on the richter scale; utilize natural ventilation and rainwater through the inclusion of a rainwater catchment system; and include facilities for the special needs of women, children, the elderly, and persons with disabilities (PWDs) and such other physical provisions guaranteeing a humane condition for evacuees. The evacuation centers shall be turned over to the LGU concerned which shall be responsible for the maintenance and operation of the center.

The budget includes funding for four (4) permanent evacuation centers or buildings per region in the country.

• For the Department of Tourism, it shall prioritize areas for ecotourism, protected and biodiversity conservation areas, heritage tourism sites, and agro-tourism areas in its tourism promotion activities.

• For the quick response fund (QRF), the original allocation of One Billion Pesos for Department of Transportation and Communications – Office of the Secretary (DOTC-OSEC) was reduced to 125 Million Pesos. We take note that in 2015, DOTC did not utilize its One Billion Pesos QRF. The remaining 875 Million was distributed to the following agencies considered frontliners in disaster response:

▪ Additional 100 Million Pesos for the QRF of the Department of Agriculture – Office of the Secretary (DA-OSEC)

▪ Additional 250 Million Pesos for the Department of Health – Office of the Secretary (DOH-OSEC)

▪ Allocation of 250 Million Pesos for the Department of National Defense – Office of the Secretary (DND-OSEC)

▪ Allocation of 100 Million Pesos for the Bureau of Fire Protection

▪ Allocation of 100 Million Pesos for Philippine National Police

▪ Allocation of 75 Million Pesos for the Philippine Coast Guard

I hope that the QRF will be used judiciously and proactively. We cannot allow funds lying in government coffers while survivors of disasters wait too long for government support. That is why it is called ‘quick’ response fund; otherwise the purpose of Congress for creating such allocation is defeated.

Closing

Mr. President,

I am very honored to have been given the opportunity to chair the Finance Committee and I share this honor to Filipinos who think that the government has long forgotten them—climate refugees, lumads or indigenous peoples, farmers, fisherfolks, rural dwellers, the elderly, small entrepreneurs, informal settlers—all of whom are greatly vulnerable to disasters and climate change. But if we address their vulnerability, reduce the risks in their communities, support their livelihood, promote their skills and traditions, and engage them in capacity building programs, they will become more productive citizens and less dependent on government.

We have just hosted the 2015 Asia-Pacific Economic Cooperation (APEC) Summit. President Aquino has concluded his visit to Kuala Lumpur for the 27th ASEAN Summit. But what do the APEC, the ASEAN Summit and the emerging ASEAN Economic Community mean to the ordinary Filipino?

The national budget is our tool to translate these international economic and trade agreements to measurable gains. It is time that we empower those who are traditionally left behind. It is time that we channel our resources to programs that will ensure sustainability so that we leave our children a livable country that they deserve.

Development is good, but development without conscience destroys our communities. It cannot be development at all costs. Thus, I want to leave a legacy budget that is socially inclusive, gender sensitive, climate adaptive, attuned towards reducing disaster risks, and that mainstreams culture and heritage in every department, something that is also sensitive and responsive to the needs of the vulnerable sectors of our population.

I hope that this proposed budget for fiscal year 2016 will merit the approval of my colleagues.

Thank you.