Diokno blames House for likelihood of a reenacted budget

Budget Secretary Benjamin Diokno is blaming the House of Representatives for a highly likely reenacted budget in 2019 with which the government would have to operate.

“The Constitution says the President has 30 days after the SONA (State of the Nation Address) to submit the budget. We have consistently submitted the budget on the day of the SONA. We don’t use the 30-day period,” Diokno said in a forum in Manila on Wednesday.

“It should be Congress, who should be blamed about this ... It is now in their court. We have submitted, in fact, ahead of time to give them more time to work on the budget,” he said.

On Tuesday, Diokno was grilled by Majority Leader Rolando Andaya Jr. during the Question Hour at the House of Representatives concerning allegations involving P51-billion of “insertions” in the Department of Public Works and Highways” proposed  budget for 2019.

Diokno was earlier mum on who was responsible for delaying proposed 2019 budget.

Asked if both chambers of the Congress are to be blamed for the possibility of operating on a reenacted budget next year, the Cabinet official said, "If you talk to senators, they have been waiting for that budget for more than a month."

The Duterte administration is set to operate on a reenacted budget in 2019 and the issue of supposed “insertions” was blamed why the budget deliberations were stalled. 

Based on the schedule of the Senate Committee on Finance, the bicameral panel will only be able to approve the proposed P3.757-trillion budget on Jan. 29, 2019.

Approving the 2019 budget next January instead of December 2018 would set the tone for a reenacted budget.

This means that the government cannot fund programs appropriated for next year as it will have to operate on the same general appropriations this 2018.

The 1987 Constitution states that “If, by the end of any fiscal year, the Congress shall have failed to pass the general appropriations bill for the ensuing fiscal year, the general appropriations law for the preceding fiscal year shall be deemed reenacted and shall remain in force and effect until the general appropriations bill is passed by the Congress.”

Negative impact

While operating on reenacted budget is a “good” mechanism provided in the Constitution to avoid disruption of government operations, Diokno said this will have a negative impact on economic growth.

“We will lose a significant amount of momentum,” he said.

Citing estimates from the National Economic and Development Authority (NEDA), the Budget chief said that a reenacted budget for the entire 2019 will take 1.1 percent to 2.3 percent of the growth potential of the gross domestic product (GDP).

“If you reduce the budget, you interrupt our growth momentum,” Diokno emphasized.

During Tuesday’s the Question Hour, Andaya also said that concerns about a reenacted budget are overstated.

The Budget chief, however, said that a reenacted budget would reduce disbursements by around P220 billion.

“Our growth targets are anchored on a carefully-crafted expansionary fiscal policy,” Diokno said.

Up to 600,000 jobs in construction, public administration and defense, wholesale and retail trade, land transport, and education, will be affected, the Cabinet official noted.

“It is also estimated that 200,000 to 400,000 individuals could be pushed into poverty following the contraction of the budget,” he said.

“I have previously served two other Presidents, and I have not seen the stars align like it has for this one with steady and relatively stable growth. We have a golden opportunity here to bring our growth even further by investing in infrastructure and human capital. We would be wasting that opportunity if we reenact the budget,” he added. —VDS, GMA News