P-Noy vows to turn around fiscal mess
President Benigno S. Aquino III, delivering his first State of the Nation Address, today said that misuse of the national budget and funds abuse by state-run firms and agencies during the Arroyo administration will weigh heavily against his fledgling administration, but he vowed to reverse the situation while opening windows of opportunity for all.
“I could almost feel the weight of my responsibility” said the President, as he lamented over initial findings that only about P100 billion or 6.5 percent of the P1.54 trillion national budget for 2010 has been left for the remaining six months of the year. This means, he said, that roughly one (l) percent is left for each remaining month.
He said that in the first half of this year, government expenditures have already exceeded the revenues boosting the first semester national deficit to Pl96.7 billion. Earlier projections placed the yearend figure to reach about P319 billion.
The President also rued over the abuse of funds by certain government-owned and-controlled corporations (GOCCs), which his people have unearthed barely a month into his six-year term.
The President said billions have been lost in still unexplained and questionable deals entered into by many GOCCs whose incumbent officials are mostly last-hour or midnight appointees of former President Arroyo.
Among state agencies he mentioned were the Metropolitan Waterworks and Sewerage System (MWSS), National Food Authority (NFA), National Power Corporation (NAPOCOR), the Metro Rail Transit (MRT), Department of Public Works and Highways to include its use of the road users tax, and the calamity funds.
The President said it was revolting to know that money was there only to be wasted.
“Your have heard how the public coffers were squandered, this is what is clear to me now: change can only come from our determination to stamp out this extravagance and corruption.
The President singled out the MWSS as an example of how state funds are misused with top officials themselves enjoying millions in cash perks and even housing privileges in MWSS properties.
He also cited the misuse of the P2 billion calamity funds where 70 percent has now been spent even as the country enters into the critical typhoon season of the year. He said distribution was found uneven, with bigger funds going into the one district of Pampanga, home-province of former President Gloria Arroyo, now congresswoman in the province’s second district.
The President also cited the critical funding situation of the National Food Authority, now debt-ridden by about Pl77 billion due to over-importation.
But as he gave the public a glimpse of the initial fiscal situation uncovered early in his term, the President said “ we will open windows of opportunities.”
He said: “If we change all this, if we prioritize enabling others we will open windows of opportunities not just for ourselves but for those who direly need it.”
“We have already begun the process of change and we are now able to dream of better things for our country. Let us not forget that there are those who wish us to fail so that they will once again reclaim power to do as they please at the expense of our people,” he said.
Among the legislative proposals he laid out in his first SONA at the joint opening session of the 15th Congress at the Batasang Pambansa Complex in
a. Fiscal Responsibility bill
b. Amendment to the Procurement Law
c. Anti-trust bill
d.
e. Amendment to the National Defense Act, and
f. Whistleblower’s bill.
g. Strengthening the witness protection program
The President bared that he would convene the Legislative Executive Development Advisory Council (LEDAC) at the soonest possible time to discuss the bills that need to be addressed He assured legislators that he would keep an open mind and treat the legislators honorably.
The fiscal responsibility bill, he said, would limit spending bills only for appropriations that have identified funding sources. The government, according to him, needs P104.1 billion to fund laws that have been passed but have yet to be implemented.
“We will re-evaluate fiscal incentives given in the past,” President Aquino said in the vernacular. “Now that we are tightening our purse strings, we need to identify those incentives that will remain and those that need to be done away with.”
Emphasizing that his administration will not allow another NBN-ZTE scandal to happen again, the President asked help from legislators to amend the country’s Procurement law. He pointed out that all proposed contracts, whether from local or foreign sources must undergo the scrutiny of correct procedures.
Stressing that it is the government’s duty to ensure that the market is fair for all, President Aquino said his administration will not tolerate monopolies nor cartels that kill competition.
“We need an Anti-Trust Law that will give life to these principles, to afford small- and medium-scale enterprises the opportunity to participate in the growth of our economy,” he said.
While asking for the passage of the National Land Use bill, the President also cited the need to amend the National Defense Act to make it more responsive to the current needs of national security. He mentioned that the law was passed during the Commonwealth period in 1935.
He appealed to legislators to pass the Whistleblower’s bill “to eradicate the prevalent culture of fear and silence that has hounded our system.”
“We will strengthen the Witness Protection program,” he said. “We must remember that from 2009 to 2010 alone, cases which involve the participation of witnesses under the program resulted in a ninety-five percent conviction.”
Pointing out that there is a need to review the country’s laws, President Aquino called on lawmakers to begin a re-codification of such laws “to ensure harmony in legislation and eliminate contradictions.”
Earlier in his speech, the President also appealed to lawmakers to go easy on the confirmation of his chosen cabinet men as he said they are all competent and have proven up to their task.
“It is but just that they not be forced to go through the eye of a needle to be confirmed by the Commission on Appointments,” he said. “Should this happen, competent Filipinos will be encouraged to help our country by becoming public servants.”
P-Noy details cases of fund misuse in first SONA
In his first state of the nation (SONA) delivered today before the joint opening session of the 15th Congress, President Benigno S. Aquino III bared in detail some cases of fund misuse during the Arroyo administration which in part have worsened the country’s budget deficit problems.
He said that in the first six months of 2010, the previous administration spent more than what it earned. Its target collection was shot by P23.8 billion and its projected expenditure is P45.1 billion, he added.
The President specified the following fund misappropriations:
Calamity Funds
Of the P2 billion Calamity fund for 2010, which on its own is already very small, only P1.4 billion or 60 percent is left for use for the remainder of the year, when typhoons are just coming in.
Of the P108 million Calamity Fund allotted for Pampanga, P105 million of this went to one district alone. These funds were released during the election period, seven months after Ondoy and Pepeng struck. Pangasinan, which was hardest hit by Pepeng, received only P5 million for the damage wrought by typhoon Cosme in 2008.
MWSS
Members of the board of the Metropolitan Waterworks and Sewerage System (MWSS) were given fat rewards even if retired government employees failed to get their pension funds due them. In 2009 alone, the payroll of MWSS amounted to P51.4 million, excluding the additional allowances and benefits amounting to P160.1 million.
Regular employees got only 13th month pay plus cash gift but MWSS board members got an equivalent of 30 months pay including bonuses and allowances. The Board of trustees also received P14,000 per meeting, reaching P98,000 each month, excluding grocery incentive of P80,000 a year; mid year bonus, productivity bonus, anniversary bonus, year-end bonus, financial assistance, Christmas bonus and additional Christmas package, all worth P98,000.
The President said the MWSS spent P2.5 million each year for each board member, excluding car incentive, technical assistance and loans.
La Mesa Watershed was not spared. Homes were built for the top officials of MWSS, who couldn’t readily be removed from their posts because they are among the Midnight Appointees of the former president.
DPWH
Infrastructure funds of the Department of Public Works and Highways for 246 priority safety projects funded by the Motor Vehicle Users Charge requiring P425 million budget but what was funded was only 28 projects and the rest were abandoned. The requested P425 million became P480 million, bigger because the additional funds went to select beneficiaries.
REHAB FUNDS
P3.5 billion that was ordered released for the victims of Pepeng and Ondoy involving 86 projects for public bidding. But 19 projects alone already got P981 million allotments. Fortunately their release was held even with the signed Special Allotment Release orders.
• P3.5 billion of current DPWH projects will now go through proper bidding for the real victims of storms Ondoy and Pepeng.
NAPOCOR
• The National Power Corp. from 2001 to 2004 was forced to sell power at a loss to forestall any electric power adjustments before the elections. Because of this, in 2004, the agency sank in debts forcing the national government to honor its P200 billion foreign obligations.
MRT
• The Metro Rail Transit was also used as a political tool by keeping the fares low, which disabled the operator from recouping its investments. As a result, the Land Bank and Development Bank of the
NFA
• The National Food Authority over-imported rice in 2004. The shortage was 117,000 metric tons but it bought 900,000 mt. In 2007 the shortage was only 589,000 mt but it bought 1.827 million mt.
Because of the over-importation, the excess supply was left to rot in bodegas even if total debts for these imports reached P171.6 billion as of May 2010, which could have funded the justice department’s budget of P12.7 billion; the conditional cash transfers of the following years amounting to P29.6 billion; all the classrooms needed in the country worth P130 billion.
Mixed reactions on P-Noy’s SONA
President Benigno S. Aquino III’s first ever State of the Nation Address (SONA) today before the joint opening session of the 15th Congress drew mixed reactions from lawmakers, a number of them optimistic he will be able to push through his programs, and others including from the opposition complementing him and offering help.
"That was a good speech. But I hope it will unfold in the future, maybe within the next 100 days," said former President Fidel Ramos, who attended the SONA together with former President Joseph Estrada.
“We are all waiting for the roadmap, for the long term plan, para umangat na tayo, “ added Ramos."
"Hopefully during the budget deliberations we will be able to uncover and see for ourselves para mas maging malinaw sa Kongreso at kung saan me pagkakamali” said the former President of the detailed enumeration by President Aquino of cases of fiscal abuse by the Arroyo administration.
Rep. Edcel Lagman, the new minority leader in the House of Representatives said he will support the government's national agenda particularly with regard to House measures which will benefit the majority of the Filipino people.
Lagman said these include measures to strengthen healthcare, employment and more economic opportunities, and environmental protection, among others. Lagman said he will support President Aquino’s campaign to improve collection efficiency by stopping smuggling, tax evasion and curbing graft and corruption.
Earlier before the SONA and after losing the House speakership, Lagman said the proposed P1.7 trillion budget for 2010-2011 should include measures to increase taxes and the national government "improve collection efficiency particularly with the
Former congresswoman Rissa Hontiveros-Baraquel expressed optimism that the SONA gave “concrete steps” on how to stamp out corruption in government.
She said the President’s SONA enumerated measures for specific government agencies to eradicate corruption such as amending the national procurement law and the passing of the Fiscal Responsibility Bill, which will provide funding for laws that have already identified its sources of funding.
Presidential Spokesperson Edwin Lacierda, for his part, said that the SONA was an “eye-opener” for the people to see the “difficulties that we are in, the sacrifices that we are supposed (to take) to help the President with.”
Meanwhile Senator Loren Legarda expressed dismay that the Aquino SONA “left out” several issues. She said the President failed to touch on topics such as agrarian reform, alleviating hunger and addressing climate change.
Legarda however was quick to add that she was pleased with Aquino’s plans were for Philhealth, the national health card,
The President said that an actual program to identify the correct number of Filipinos who sorely need Philhealth coverage will be undertaken as “current date is conflicting on this matter.”
He added that Social Welfare Secretary Dinky Soliman “are moving to implement the National Household Targeting System that will identify the families that most urgently need assistance.”
“An estimated P9-billion is needed in order to provide coverage for five million poor Filipinos,” P-Noy said.
