Arroyo govt should ensure spending is properly allotted for social services
MANILA, Philippines - The Arroyo administration should abandon efforts to keep the deficit within programmed goals and instead ensure that “expenditures are properly allocated and appropriated for social services."
These, among others, were raised by the multisectoral Freedom from Debt Coalition (FDC) during a Tuesday briefing held in Quezon City.
Besides casting doubt on the government’s ability to balance the budget by 2013, the FDC said that a zero deficit should not be the goal especially given the deepening global recession.
“It’s all right to incur a deficit as long as spending is properly allocated and appropriated for social services," FDC vice president Rebecca Malay said, adding that the business sector cannot pump prime the economy alone.
The group also criticized the Arroyo administration’s “obsession" in balancing the budget, which is stipulated under the Medium-Term Philippine Development Plan (MTDP) for 2004 to 2010.
The plan also intends to reduce the ratio of consolidated public sector debt to just one percent of the country’s output in 2010 from 6.7 percent in 2004.
“This shows the Arroyo administration’s lack of a development plan with which to anchor its fiscal program. It relies on the private sector, in particular foreign investors, to put their money where they best see it fit," Malay said.
Achieving these goals result in reduced expenditures, privatization, and regressive taxation, she said.
It’s all right to incur a deficit as long as spending is properly allocated and appropriated for social services.
– Freedom from Debt Coalition
Goals in the government’s development plan “are wrong to begin with," Malay said. “This outlook is not how government’s fiscal policy contributes to the economy but how the government’s books will look good to creditors," she said.
Moreover, the Arroyo administration “resorted to reducing non-debt expenditure as debt payments are automatically paid, by increasing ‘easy revenues’ – the easiest of which is via the reformed value-added tax (VAT) and by increasing privatization proceeds by selling more government assets," FDC vice president Ben Moraleda said.
These, in turn, resulted from President Gloria Macapagal-Arroyo’s “abuse of executive power" when she vetoed fund allotments in the 2007 to the 2009 budget.
The FDC also called for a moratorium on foreign debt payments as the country is “already close to economic bankruptcy."
Developing countries such as the Philippines have an “immediate need to rearrange their priorities and focus on stimulating their respective economies in order to curb the effects of the crisis," said Akbayan Rep. Risa Hontiveros, who is also an FDC member.
She cited the United Nations Conference on Trade and Development (UNCTAD) which called for the immediate debt moratorium of all highly indebted countries to provide “breathing space in the current global crisis."
“Servicing the debt amid the uncertainty of the global financial crunch is allowing the country's resources go to waste," she said.
This sentiment was shared by Milo Tanchuling, the FDC’s secretary-general.
“In times of crisis, we should put the country’s needs first before the situation worsens. Developed countries can allot $1 trillion to save their economy. Where can we get the funding if we will put debt servicing first? Our domestic economy is weak. There is no support for agriculture," Tanchuling said. - GMANews.TV
These, among others, were raised by the multisectoral Freedom from Debt Coalition (FDC) during a Tuesday briefing held in Quezon City.
Akbayan Rep. Risa Hontiveros called on the govt to stop paying debts and instead "focus on stimulating the economy" to curb the effects of the crisis. On her right is Freedom from Debt Coalition secretary general Milo Tanchuling. GMANews.TV
“It’s all right to incur a deficit as long as spending is properly allocated and appropriated for social services," FDC vice president Rebecca Malay said, adding that the business sector cannot pump prime the economy alone.
The group also criticized the Arroyo administration’s “obsession" in balancing the budget, which is stipulated under the Medium-Term Philippine Development Plan (MTDP) for 2004 to 2010.
The plan also intends to reduce the ratio of consolidated public sector debt to just one percent of the country’s output in 2010 from 6.7 percent in 2004.
“This shows the Arroyo administration’s lack of a development plan with which to anchor its fiscal program. It relies on the private sector, in particular foreign investors, to put their money where they best see it fit," Malay said.
Achieving these goals result in reduced expenditures, privatization, and regressive taxation, she said.
It’s all right to incur a deficit as long as spending is properly allocated and appropriated for social services.Goals in the government’s development plan “are wrong to begin with," Malay said. “This outlook is not how government’s fiscal policy contributes to the economy but how the government’s books will look good to creditors," she said.
Moreover, the Arroyo administration “resorted to reducing non-debt expenditure as debt payments are automatically paid, by increasing ‘easy revenues’ – the easiest of which is via the reformed value-added tax (VAT) and by increasing privatization proceeds by selling more government assets," FDC vice president Ben Moraleda said.
These, in turn, resulted from President Gloria Macapagal-Arroyo’s “abuse of executive power" when she vetoed fund allotments in the 2007 to the 2009 budget.
The FDC also called for a moratorium on foreign debt payments as the country is “already close to economic bankruptcy."
Developing countries such as the Philippines have an “immediate need to rearrange their priorities and focus on stimulating their respective economies in order to curb the effects of the crisis," said Akbayan Rep. Risa Hontiveros, who is also an FDC member.
She cited the United Nations Conference on Trade and Development (UNCTAD) which called for the immediate debt moratorium of all highly indebted countries to provide “breathing space in the current global crisis."
“Servicing the debt amid the uncertainty of the global financial crunch is allowing the country's resources go to waste," she said.
This sentiment was shared by Milo Tanchuling, the FDC’s secretary-general.
“In times of crisis, we should put the country’s needs first before the situation worsens. Developed countries can allot $1 trillion to save their economy. Where can we get the funding if we will put debt servicing first? Our domestic economy is weak. There is no support for agriculture," Tanchuling said. - GMANews.TV
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