The 2025 General Appropriations Act (GAA) was originally scheduled for signing yesterday. The ceremonies were canceled – indefinitely.
The budget is in limbo. It might not be sufficient for the President to do minor surgery on this grossly flawed document. The bicameral conference committee might have to be reconvened to deal with the mess. Or, this most vital piece of legislation might have to be returned to Congress for redrafting.
This mess will not clear in the few working days we have left. Our budget cycle follows the calendar year. By Jan. 1, 2025 the Marcos administration might be forced to work with a reenacted budget. This will be a major setback for the administration politically and for the whole nation economically.
It might even be a watershed moment. Even a Waterloo for an administration that has not even made it to midterm.
By scheduling yesterday’s signing ceremonies, the administration clearly expected the budget process to advance routinely. It has overwhelming majorities in both chambers of Congress, a factor that should have enabled the administration to shape the budget according to its vision.
The executive branch was indolent. The legislative branch was acting like it was a separate republic.
What the current budget crisis tells us is that the administration was diffident through the whole process. It sat back and watched the legislators butcher the budget according to their own greed.
One very articulate economist called the 2025 GAA the most corrupt budget the nation ever had. It will be hard to disagree with that.
One might also say this is the most stupid budget the nation has ever seen.
It reduced the allocations for health and education even as it raised the share of unprogrammed appropriations (UA) to P531.7 billion, about eight percent of the total budget. The original executive branch proposal was for UA of P158.7 billion. Our legislators painted the town red and raised this to a whopping P531.7 billion.
The proposed budget took money from institutions such as PhilHealth and the DepEd while pushing billions to some badly defined “AKAP” dole-out program that could be used to effectively buy votes in the midterm elections.
There are at least a dozen truly scandalous features of the 2025 GAA.
The budget for the DPWH was inexplicably increased by P288.6 billion. We know how that works. The projects are distributed to the congressional districts. Somewhere between 30 percent to 60 percent of these project funds are lost to kickbacks.
Allocation for the House of Representatives increased by P17.3 billion. We know how that works, too. Much of the money will go to spending for patronage.
Meanwhile, the DSWD loses about P95.9 billion in the bicameral version of the 2025 GAA. The Philippine Health Insurance Corporation loses its entire P74.4-billion subsidy. The CHED loses P26.9 billion. The Department of Health loses P25.8 billion. NIA loses P23.2 billion. The Department of Agriculture, which we expect will pull us out of our food crisis, loses P20 billion. DOLE, which looks after our workers, loses P18 billion. The Transportation Department loses P16.6 billion.
You catch the drift.
The mainline agencies supporting governance goals suffered losses. A large slush fund that could be directed by the politicians was put together. Very little taxpayer money is allocated for what might be called economic investments. So much money is pushed into what is truly a large pork barrel.
The Comelec put out guidelines to keep the politicians from using budget money for electioneering. The guidelines will simply deodorize a national budget obviously configured for patronage politics.
No one could possibly accuse the 2025 GAA of being a “developmental budget.” This measure is designed to fritter away taxpayer money through funny programs that will not enhance our economy’s competitiveness or efficiency.
Nor will the 2025 GAA help us reduce our national debt.
The proposed 2025 budget amounts to P6.4 trillion, equivalent to 22.1 percent of the GDP and 10 percent higher than the 2024 budget. Revenues are programmed to reach P4.6 trillion, equivalent to 16.2 percent of GDP. Discounting whatever else government may earn through non-tax revenues such as the sale of public assets, the difference will be covered by borrowing.
In 2025, our deficit is expected to reach P1.5 trillion or 5.3 percent of GDP. Because of this, our national government’s outstanding debt is expected to increase to P17.4 trillion in 2025. This is equivalent to 60.4 percent of GDP – crossing the standard threshold for fiscal prudence.
To support the profligacy of today’s politicians, our children and children’s children will be pushed deeper into debt. Nothing forgives that.
For weeks, our legislators distracted us with abusive “quad comm” hearings. Behind the scenes, they were plotting to steal the nation’s future.
The 2025 GAA presents President Marcos with something a little more than a hot potato. We have a house on fire. This proposed budget is swindling on the grandest scale. Our people are angry. People everywhere are talking about the features of this budget document like we have never done before. Social media is helping fan the political fire.
This is a profoundly tainted budget. No minor tinkering with the numbers and no cosmetic accounting will arrest the anger building up.
President Marcos has no choice but to trash this polluted document and accept reenactment of the 2024 budget – or court fury in the streets.