Diokno: Budget approval delay to stall economic growth

MANILA, Philippines — Failure of Congress to have next year’s budget approved before the end of the year will seriously set back economic growth, budget chief Benjamin Diokno said yesterday.

A squabble between lawmakers and the Department of Budget (DBM) over insertions in the proposed P3.757-trillion national outlay is hampering the passage of the appropriations measure and raising the scenario of a reenacted budget for next year.

Diokno said fund releases for projects aimed at promoting economic activity would be reduced by P44 billion if no new budget is passed in the first quarter.

If no budget is passed at all, disbursements would be cut by as much as P220 billion, the budget chief said at a press briefing in Malacañang.

“A reenacted budget will be detrimental to the economic growth and development objectives of the Duterte administration. The government intends to ramp up investments on public infrastructure, poverty alleviation and social services,” Diokno said.

“We are hopeful that the legislators will see the urgency and wisdom in passing at the soonest possible time the national budget for 2019,” he added.

Diokno said some of the projects could be accelerated in the first quarter to minimize the damage to the economy.

“But I think it’s premature at this time to say that this will actually slow down the economy that much,” the budget chief said.

Diokno said failure to pass a new budget for the entire year could cut as many as 600,000 jobs and could slow down economy by as much as 2.3 percent.

“It will result in deeper poverty for some 200,000 to 400,000 individuals. That is the worst case scenario. Let’s hope it will not happen,” he added.

At a recent budget hearing, Diokno and some lawmakers traded barbs over the alleged unauthorized insertions in the expenditure program.

House majority leader Ronaldo Andaya Jr. was claiming that Diokno had inserted some P75 billion in the 2019 budget without the approval of President Duterte.

He said the budget chief had allotted huge sums for infrastructure projects in the budget of the public works department.

Diokno has denied any wrongdoing, saying the adjustment in the outlay for infrastructure is part of the budget preparation process.

He also revealed that the infrastructure budget of P480 billion has been raised to P555 billion because the government has enough funds to do so.

Some House members have urged Duterte to reconsider Diokno’s appointment because of the alleged insertions in the 2019 budget.

Malacañang has expressed support for Diokno and labeled as “baseless” the accusations against the budget chief.

The House rules committee is set to hold a hearing next month in Naga to investigate CT Leoncio, the alleged “favored” contractor of Diokno. 

Diokno said he was advised by Executive Secretary Salvador Medialdea to skip the hearing while the protocol on attending congressional hearings is being reviewed.

“I was ambushed (at the House of Representatives). So that kind of behavior on their part, we don’t want a repeat. The President said walk out if you are disrespected. They will cite you in contempt. The President might go there, he will take me out of there. I want to avoid that crisis,” Diokno said, referring to the House Question Hour he attended last week.

Former speaker Pantaleon Alvarez earlier said the House’s tiff with Diokno was related to the P45-billion road user’s tax controlled by the Road Board, a body that Malacañang and the Senate want abolished.

Alvarez had claimed that the allies of House Speaker and former president Gloria Macapagal-Arroyo wanted to control the proceeds from the road user’s tax. He had also accused Road Board officials of being in cahoots with some lawmakers in collecting commission from contractors.

The former speaker said some House members wanted Diokno to release the proceeds of the road user’s tax but the budget chief refused because the President wanted the Road Board abolished.

Diokno insisted that the administration would not release the proceeds of the road user’s tax because of the alleged irregularities in the Road Board. He said some lawmakers appear to be interested in the road user’s tax proceeds because of the coming elections.

“Inaasahan yata nila iyon, na ma-release iyon para naman siguro magamit nila sa kampaniya (They’re hoping for it, they want it released so they can use it for the campaign). But I tell you, we will not release,” Diokno said.

Presidential spokesman Salvador Panelo had made it clear that Duterte would eventually sign into law the bill abolishing the Road Board.

Diokno claimed that “lots of congressmen,” including Andaya and Quezon Rep. Danilo Suarez, had followed up on the status of the road user’s tax. 

Diokno said Suarez was the author of the road user’s tax and chairman of the Road Board during the presidency of Arroyo. 

“He is trying to protect the Road Board. The Senate felt that they are not willing to sit down to thresh out the differences so they adopted the House version. The Senate adopted the House version, since there is no more disagreeing provision that should be automatic, no more disagreeing,” the budget chief said.

Diokno said the House rescinded its approval of the bill abolishing the Road Board after Arroyo assumed the speakership. Asked whether he thought lawmakers attacking him had Arroyo’s blessing, Diokno replied it could be “speculation.”