In a statement, Mrs. Arroyo vowed that 2007 "will be a watershed for national security as we mop up the remnants of the Abu Sayyaf in Mindanao and continue to blunt the tactical edge of the New People’s Army (NPA)."
She said the expected "end of terror" this year will jump-start peace and development in Mindanao, backed by the support of the international community as well as efforts at interfaith dialogue.
"Meanwhile, we shall continue to strengthen the ramparts of democracy by cutting off the tentacles of the NPA that impose revolutionary taxes on the people and campaign taxes on candidates for the polls," Mrs. Arroyo said.
She said the government will "combine a strategy of military action, good governance, the peoples’ alertness, strong regional and global alliances, principled peace negotiations and the sword of all faiths to bear against terror and insurgency."
The morale of soldiers and the people, she said, remains high over the deaths of Abu Sayyaf leaders.
Officials said the Communist Party of the Philippines (CPP)-NPA’s "revolutionary taxation" was just a euphemism for extortion activities to raise funds for the insurgency.
The CPP-NPA has been tagged as a foreign terrorist organization by the United States and the European Union. Estimates placed the NPA’s strength at about 8,000 armed regulars.
National Security Adviser Norberto Gonzales earlier disclosed the CPP-NPA has increased its "permit-to-campaign" fees for the coming elections due to dwindling funds.
He said the lack of funds was partly due to the fact that hundreds of millions of pesos in pork barrel fund for party-list groups allegedly fronting for the CPP-NPA have been withheld since last year to prevent them from being diverted to the rebels.
"Since 2006 we stopped the release of pork barrel funds to these fronts of the CPP-NPA and now these party-list groups are very, very angry because they no longer have funds for rebel activities. We expect their extortion activities to intensify to compensate for the loss of the pork barrel funds," Gonzales said.
Each member of the House of Representatives receives about P40 million as their congressional allocations for projects. Among the party-list congressmen whose allocations were withheld were those of Bayan Muna Reps. Satur Ocampo, Teodoro Casiño, and Joel Virador; AnakPawis Reps. Crispin Beltran and Rafael Mariano; and Gabriela Rep. Liza Maza.
He said the communist fronts are feeling the lack of funds.
"You can see their anti-government rallies are getting smaller and smaller. Even in Cebu during the (Association of Southeast Asian Nations) summit, they cannot muster a credible crowd," Gonzales said.
Gonzales said other left-leaning party-list groups had their pork barrel allocations retained since while they continue to oppose the government, "they do not resort to violence, extortion, burning of buses and cell sites and killing of innocent civilians."
"Other leftist party-list groups in Congress have made so many painful statements against the Arroyo government but they remain within the democratic framework. Actions like that are respected because that is really democracy. You cannot please everybody," he said.
Gonzales said that in the past, as the government was moving to choke off funding to communist rebels, these party-list groups resorted to bribing officials of the Department of Budget and Management by giving them 20 percent of every amount released in exchange for the release of their pork barrel allocations.
"But we have already dealt with that (bribery)," he said without elaborating.
A ranking budget official said previous investigations have shown that some of the pork barrel funds of these party-list groups have been funneled to the NPA and even sympathetic local officials.