Imagine this as our tourism secretary (w/ update)

Need I say more?

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(UDATE 7:15 PM): As per ABS-CBN News, Sen. Noynoy Aquino is going on a week-long hiatus. Thank God! The baby needs to clear his head. I hear his next Cabinet appointment could be Pokwang as Finance Secretary.

EDITORIALS

Inquirer: Diminished

Power—both for those who wield it and who are subordinate to its holders—has its own inexorable logic. Thus we can assume that a designation lasting only until June 30, for many of the officials reshuffled or promoted by the President, is its own reward.

If that were the case the public might consider the latest presidential reshuffle in bad taste, and of doubtful legality, but nothing more than yet another appalling example of how the administration is detached from any ethical moorings. But there are more far-reaching implications: name the institution, and hardly any has been left untouched. Our career diplomats are up in arms over the shabby treatment of Ambassador Delia Albert; the military is irritated with junior generals leapfrogging senior ones; the legal community is also upset over the maneuvering over the next chief justice; the civil service has more reason to be dismayed; and even our cultural agencies have been purged with all the zeal of Mao Zedong during the Cultural Revolution in China

Click INQUIRER.net.

Phil. Star: A failed experiment

The party-list system, according to a member of the commission that crafted the Constitution, was envisioned to be an experiment in congressional representation. At the hands of people with unbridled greed for political clout and all the perks of public office, the experiment is doomed to failure. Today the party list has become nothing more than a backdoor entrance to the House of Representatives.

Major political parties use it to install more partisans in the House, with the same right to vote and the same pork barrel allocations as regular congressmen. Major religious groups use it to advance their interests and expand their influence in the political realm. And President Arroyo, in the twilight of her nine years in power, appears bent on installing every able-bodied relative and loyalist official in the House, even through the backdoor, and even if none of the officials can be considered marginalized by any stretch of the imagination, to ensure her continuing influence over national affairs.

Click Phil. Star

Malaya: Something’s cooking (2)

THE government last year tried selling three big-ticket privatization items, without success because of poor market interest. The Department of Finance is again hawking the three items at bargain basement pieces and through negotiated arrangements, and seeking to strike a deal within the second quarter. The justification, as usual, is the need to cap the deficit for 2010 at the programmed P293 billion.

But what’s so pressing a need is there to meet the June 30 deadline? Because Gloria Arroyo is exiting on that day?

Click Malaya

EDITORIALS

Phil. Star: Junta

Considering the country’s recent political history, officers of the Armed Forces of the Philippines should not be surprised that the public easily succumbs to speculation that the military might be used to facilitate cheating in the general elections in May. The worse speculation is that the AFP will be used to create a scenario that will warrant the declaration of a failure of elections, which could pave the way for President Arroyo to stay on beyond noon of June 30.

Click Philippine Star.

Inquirer: Small sacrifice

For the good of the country, we urge Senate President Juan Ponce Enrile to resign before the May 10 elections to pave the way for the election of a new Senate president. The election of a new Senate president will help relieve the nation’s fear and uncertainty over a power vacuum in the event of a failure of elections.

Click Inquirer

Malaya: P100B stimulus package

FINANCE Secretary Margarito Teves’ announcement yesterday that, contrary to earlier official pronouncements, the government will pursue a P100 billion stimulus package this year should be taken with a grain of salt.

Click Malaya

Malampaya: Why sell goose laying golden eggs?

DEMAND AND SUPPLY
By Boo Chanco

With only three months to go before a new administration takes over, it is easy to see this impending sell-out of a prime revenue-generating government asset as one more short-term measure of this administration most probably for some kind of self-serving gain. The deal is obviously unwise from a business investment point of view and seems fraudulent from a governance perspective, Ms. Ferrer observes. 

Given the reputation of this administration it is easy for some to “surmise the funds will be diverted to private pockets, or electioneering. Others think the administration wants to exit without the shameful legacy of a huge budget deficit…. Still others cannot help think of even more sinister plots in the offing, such as the eventual privatization of the much devalued PNOC-EC at bargain prices to a favored investment group.”

Or maybe, this is just a case of a very desperate Finance Secretary who is ready to sell the most saleable government asset regardless of other strategic considerations because his exit report card would otherwise report that large deficit. But if he is using his brains the way he used to in his younger days, he would realize that ending his watch even with that deficit number is not as bad as losing a strategic investment in a strategic industry that also more than pays for itself.

Click Boo Chanco.

Next president will face a fiscal crisis

POLICY PEEK
By Ernesto Herrera

In past debates and forums presidential bets seem to agree that whoever among them wins will certainly face serious fiscal challenges. The government is in the red and the business of operating it from day-to-day would be difficult to say the least.

President Gloria Macapagal Arroyo can brag about her accomplishments all she wants but the fact is she hasn’t been able to reverse the nation’s unsustainable long-term fiscal course driven primarily by heavy foreign borrowings and huge budget deficits.

Civil society groups have been calling for more fiscal responsibility from this administration since it took over but their calls have been unheeded. Now it would be up to the next president to do something about the government’s precarious financial situation.

Budgets and borrowings don’t normally hold the public’s attention as much as corruption scandals, but it should. Politicians and the public often ignore these huge drains on the budget, but they have devastating effects on the daily lives of Filipinos.

Vice presidential candidate and senator Mar Roxas said the GMA administration’s “profligate spending and borrowing binge” in the last two years will cost Filipinos an additional P50 billion a year, just to cover the 2009 to 2010 combined budget deficit amounting to P600 billion.

While public debt is increasing, the government is in a spending spree, Roxas noted. He said the P50 billion in interest payments would force the next administration to resort to drastic revenue-generating measures to keep the economy afloat.

The budget deficit reached P300 billion last year and another P300 billion deficit is expected this year.

“We have exceeded our deficit, which means government has again failed to meet its revenue targets. All taxes to be collected by the BIR and the BOC would now go to debt payments,” Roxas said.

A large chunk of the national budget is gobbled up by debt payments. Of the P1.541 trillion national budget for 2010, a total of P253.458 billion is earmarked to pay foreign debts.

Every peso or dollar we spend to pay our debts or just the interests of these debts means less money available for fighting poverty. It means less money to spend on health care, social services, the environment, housing and urban development, agriculture.

Has any of the leading presidential bets proposed to negotiate a debt payment moratorium or a debt swap? A better question perhaps would be, did all the money the government borrowed actually help Filipinos?

The Bangko Sentral ng Pilipinas said that the country’s outstanding external debt rose to $53.1 billion by the end of the third quarter last year, and yet in a SWS survey more Filipinos rated themselves poor and hungry than ever before. Even Joey Salceda, GMA’s economic adviser, admits more Filipinos are poorer now.

Another vice Presidential candidate and senator, Loren Legarda, noted how the Arroyo administration has been relying heavily on foreign borrowings to finance its infrastructure development and social services delivery.

“With annual tax collection always falling far short of required expenditures, the government resorts to borrowings from abroad to make ends meet. But who really benefits from the borrowing spree? It’s not the poor, definitely,” she said.

The present administration has put government in the red, but it’s the next administration’s problem how to get it back into the black.

Labor bucks GMA veto of OFW remittance tax abolition

The Trade Union Congress of the Philippines has assailed the Department of Finance for asking President Macapagal Arroyo to veto a provision in the proposed new Migrant Workers Act that exempts the money wired home by overseas Filipino laborers from the documentary stamp tax (DST).</p<

Malacañang should reject outright the DOF’s foolish and contemptible request. The DST on remittances has been a burden to overseas Filipino workers (OFWs) and their families here and it should have been abolished a long time ago.

A provision in the proposed new Migrant Workers Act, ratified by both the Senate and the House on January 18, excludes the cash sent home by OFWs from getting slapped the DST. The removal of the DST on the money wired home by OFWs would help drive down oppressive remittance charges, and put extra cash in the pockets of many households.

At present, under the Tax Code, all money transfers from abroad and payable in the Philippines, including those wired home by OFWs, are subject to the DST at a rate of P0.30 for every P200.

This means that OFWs pay a DST of P34.60 for every $500 or P23,065 (at $1:P46.13) that they send home. This is on top of the usual foreign and local bank fees, plus the P0.50 to a dollar margin that domestic banks are allowed when they pay out the remittance in pesos.

On the $17.348 billion (P800.263 billion at $1:P46.13) sent home by OFWs in 2009 via the banking system alone, the Bureau of Internal Revenue (BIR) collected a total DST of at least P1.2 billion. This year, assuming annual remittances grow by 10 percent to $19 billion, the BIR will be raking in another P1.3 billion in DST from OFWs.

This question really is, whether the P1.2 billion or P1.3 billion is better kept in the government’s pocket, or in the pockets of the families here of our OFWs. We say abolish the DST on the money transfers made by our OFWs, and let their families here keep the extra cash for them to spend. (Manila Times)

ernestboyherrera@yahoo.com

Malaya Editorial: Fiscal planning on the wing

FINANCE Secretary Gary Teves yesterday said the current set of economic managers will keep the programmed budget deficit at P293.2 billion. Might as well. The programmed deficit had so become a rapidly moving target in 2009 that it became a meaningless basis for policymaking.

We understand that the budget has to be prepared at least six months before the start of the year of its effectivity. The Constitution requires the president to submit the proposed spending measure 30 days from the regular opening of Congress. This means the general economic assumptions employed by the development budget coordinating committee are at best educated guesses.

Click Business Insight Malaya.

2009 budget deficit swells to P298.5 billion

MANILA, Philippines – The government’s budget deficit swelled to P298.5 billion last year, above the expected P290 billion and also higher than the target for the period of P250 billion because of anemic revenues and additional spending, Finance Secretary Margarito Teves announced yesterday.

Last year’s budget gap is more than four times the P68.1-billion deficit registered in 2008 or an increase of 338.3 percent.

A budget deficit means the government does not have enough revenues to fund its expenses, particularly social services and infrastructure spending.

Click Philippine Star.

Arroyo too busy for Lolos, Lolas

MANILA, Philippines — Senior citizens awaiting the signing of a bill that would give them a full 20-percent discount on goods and services, as a result of being exempted from the expanded-value tax, on top of other benefits, will have to wait until President Gloria Macapagal-Arroyo finds an opening in her busy schedule.

Malacañang said on Sunday the President was too busy to affix her signature to the Expanded Senior Citizens Act, a measure that would also give indigent seniors and non-pensioners free medical insurance and disability assistance.

Click INQUIRER.net.

Palace chides Loren, defends property auction

“Puro haka-haka lang yan, gumagawa ng issue where there is no issue at all The supposed fire sale is just speculation. Someone is making up an issue where there is none,” Bello said on government-run dzRB radio on Saturday.

At the same time, Bello defended the property auction, saying that the government has “been trying to sell this property so it will be run better by the private sector,” referring to the Food Terminal, Inc., FTI one of the properties being sold.

Bello added that the sale of the FTI property has been ongoing since the administration of former president Fidel Ramos.

Click GMANews.TV .

Pssst, Loren, magbasa ka nga. Ang tagal na binebenta ang mga properties na yan, wala lang takers. Haven’t you heard there’s a budget deficit?