Ridden with skewed priorities, red flags, and questionable potential pork funds.
This is how progressive groups describe the P5.768-trillion proposed national budget for 2024. (One US dollar is equivalent to P56.63)
The proposed budget for next year represents a 9.5 percent increase from the current P5.27 trillion. For research group IBON, however, the proposed 2024 budget is unresponsive to the “biggest economic problems” that the country is facing.
One red flag, according to the group, is the budget allocation for social services – especially when compared with the share of defense programs in the proposed national budget.
When classified based on function and purpose, the social services sector – which includes health, education, culture, and manpower development – will receive 37.9 percent of the proposed 2024 budget, with an allotment totaling P2.2 trillion. This represents an 8.9 percent increase from the P2 trillion social services budget in 2023.
However, in terms of increases, the defense sector – which includes funding for land, air, and naval forces defense programs – will receive the highest budget increase, registering a 21.6 percent hike in its total budget.
Included in the budget for defense is the P50 billion budget for the “Revised AFP Modernization Program” (RAFPMP), an 81.8 percent increase from its current P27.5 billion. The RAFPMP, which funds the procurement of military weapons, equipment, and vehicles, targets to procure additional multi-role fighters, radars, frigates, missile systems, and rescue helicopters in the next five years.
“The staggering increase in the defense budget is a big red flag,” Kabataan Partylist Rep. Raoul Manuel said. “As we have already witnessed how in the past years, our security sector’s focus was not about strengthening our external defense capabilities – especially when it comes to fending off incursions in our territory – but rather on committing various forms of human rights violations, including the militarization and even bombing of communities.”
Also tucked in the 2024 defense budget is a total of P9.7 billion for the National Task Force to End Local Communist Armed Conflict (NTF-ELCAC), of which P1.08 billion is lodged under the Philippine National Police, and P8.64 billion is for the “Barangay Development Program” that seeks to fund projects for 864 “cleared” barangays.
“The proposed budget for the NTF-ELCAC is another wasteful illogical capricious use of public funds for an entity that has done nothing to address the root cause of armed conflict and economic underdevelopment of the country. We shouldn’t be funding government programs and entities which violate human rights and international humanitarian law,” said Cristina Palabay of human rights group Karapatan.
Comparing the 2023 and 2024 budgets by agency, the Department of Transportation (DOTr) is set to receive the biggest budget increase, with the government proposing an additional P108.3 billion for the said agency, more than doubling its budget from the current P106 billion.
The DOTr budget includes P163.7 billion for the “Rail Transport Program,” which seeks to build several multibillion infrastructure projects listed in the “Build Better More” infrastructure program of the Marcos Jr. administration, including the North-South Commuter Railway System, which seeks to connect New Clark City, Capas, Tarlac to Calamba, Laguna.
“The persistent insistence on infrastructure spending is particularly misguided. Too many of the big-ticket projects are dependent on imported materials, equipment and contractors which means that domestic stimulus effects are muted and it will be the Japanese, American, European, and Chinese sources of imports that will really be gaining. The long-term impact of these projects is also limited in the absence of bold complementary measures to modernize agriculture and build Filipino industry,” IBON Executive Director Sonny Africa said.
The Department of Education (DepEd) only positions second in the ranking of agencies that will receive the biggest budget increases, with the agency set to receive a total P758.6 billion budget for 2024, a P36.8-billion hike from its current P721.8 billion budget.
Despite the overall increase in the DepEd budget, only the offices directly under the Office of the Secretary will benefit from additional funding. Other attached DepEd agencies will all receive significant budget cuts, including the National Book Development Board, the National Council for Children’s Television, the National Museum of the Philippines, the Philippine High School for the Arts, the Early Childhood Care and Development Council, and the National Academy of Sports.
Hefty cuts in social services
Other agencies providing economic and social services will also receive hefty cuts, including the Department of Agrarian Reform, the Department of Labor and Employment, the Department of Health, and the Department of Migrant Workers.
“Public spending on social services should increase in times of crises when low-income Filipinos need these the most. The cuts in social protection and health are thus unacceptable and reflect the administration’s low prioritization of millions of distressed Filipino households,” Africa said.
IBON also noted that several regular emergency assistance programs that were already cut by P7.5 billion in 2023 will suffer an even bigger P27.7 billion cut in 2024.
In the Department of Labor and Employment, the “Tulong Panghanapbuhay sa Ating Disadvantaged/Displaced Workers” (TUPAD) program for informal workers will also incur a P6.4 billion cut.
IBON noted that the biggest cut in assistance programs can be found in DOH’s medical assistance to indigent and financially-incapacitated patients program, which will suffer a P10.4 billion cut.
Meanwhile, up to P733.2 billion in programmed “Special Purpose Funds” (SPFs) is also present in the proposed 2024 national budget, which critics dubbed the “presidential pork barrel,” as these funds can easily be tapped to fund items not explicitly stated in the national budget.
The budget department defines SPFs as appropriations to cover expenditures for specific purposes for which recipient agencies have not yet been identified during budget preparation.
The proposed budget for SPFs represents a P219.8 billion hike from the current P513.6 billion allocation. One item, the “Miscellaneous Personnel Benefits Fund” (MPBF), will receive a whopping 409-percent increase from the current P26.6 billion to P135.7 billion next year.
The special provisions governing the use of the MPBF indicated in the 2024 NEP explains that the said fund can be used for “deficiencies in authorized salaries, bonuses, allowances, associated premiums and other similar personnel benefits of National Government personnel, including the Personnel Services requirements for filling of, and creation of positions, and compensation adjustments, as may be authorized by law, the President of the Philippines, or the DBM.” Another provision also allows the government to use the MPBF to hire contractuals.
“The inclusion of ‘pork barrel’ funds in the 2024 budget highlights the duplicity of the president’s claim about the rise of a new Philippines. The president’s budget enables political patronage – the lack of transparency in the so-called ‘Special Purpose Funds’ raises suspicions about the real motive in designing the budget this way,” said Raymond Palatino of Bagong Alyansang Makabayan.
As for financing next year’s budget, the national government projects that it will be able to collect a total of P4.3 trillion in tax and non-tax revenues. Tax revenues are expected to increase by 15 percent, or P536 billion, from the P3.5 trillion targeted collections this year to P4.07 trillion.
However, there remains a P1.4-trillion budget deficit, which will be financed through loans. The national government targets to incur additional domestic and external debt totaling P3 trillion next year, resulting in a projected outstanding public debt by year-end 2024 amounting to P15.8 trillion.
Using the Philippine Statistics Authority’s projected population for mid-year 2024 of 114 million Filipinos, debt per capita is set to amount to P138,764 next year.
“The government’s fiscal strategy is seriously flawed. Revenues are low from over-relying on indirect consumption taxes on poor and middle-class Filipinos who have low levels of incomes and spending, from cutting direct taxes especially on high-income families and large corporations, and from avoiding wealth taxes even just on hugely concentrated billionaire wealth. Poor revenue generation is ultimately what causes constant borrowing and excessive debt,” Africa explained.
Africa added that the additional debt the government seeks to incur “is not really going to making the economy more dynamic and revenue-generating,” noting that for 2024, the government targets to spend P1.9 trillion in debt service, with P670.5 billion in interest payments and P1.24 trillion for principal amortization.
‘Heightened public vigilance’
In a statement, House Speaker Ferdinand Martin Romualdez said that the Lower House targets to approve the proposed national budget in just five weeks, passing its version for Senate consideration by mid-September.
Manuel noted that even if the House leadership attempts to railroad the General Appropriations Bill, he and his colleagues in the Makabayan bloc will exhaust all means to bring to light all questionable items in the proposed budget.
“We also call on the public to scrutinize the proposed national budget and to devise an alternative people’s budget, highlighting what programs the government should prioritize instead. A parallel strong people’s movement should run alongside the budget deliberations in Congress to highlight where every peso of public funds should be spent,” Manuel concluded.