Seven business organizations said they are joining the economic managers' "call for a more detailed analysis of the fiscal impact of federalism to serve as basis for the deliberations in Congress."
Business groups back economic managers, urge Congress to weigh costs of shift to federal gov’t
( - August 12, 2018 - 6:58pm

MANILA, Philippines — Several business organizations expressed support to the Philippine economic managers who earlier called on legislators to carefully review the government’s shift to a federal government.

In a joint statement released Sunday, seven business groups said it is asking Congress to weigh the costs and risks involved in the proposed shift to a federal system of government.

“We, too, believe in the need to adhere to the  public finance principle ‘funds follow function.’ Accordingly, we echo the concerns of fiscal and economic experts about the ambiguous provisions on the division of revenue and expenditure responsibilities between the proposed federal government and its federated regions,” the groups said.

The seven groups which signed the joint statement include the following:

  • Cebu Business Club

  • Employers Confederation of the Philippines

  • Financial Executives Institute of the Philippines

  • Makati Business Club

  • Management Association of the Philippines

  • Philippine Chamber of Commerce & Industry, Inc.

  •  Philippine Exporters Confederation, Inc.  

The organizations expressed concern over the alarming cost to the would-be multi-level government under a federal system.

“Preliminary estimates range from P72 billion of the Philippine Institute for Development Studies to P130 billion of the National Economic Development Authority,” the groups said.

The groups estimated the fiscal deficit to reach around 6.7 percent of the gross domestic product. They said the figure is “way beyond the sustainable 3 percent target of the fiscal managers,” which, they added, is a prudential limit also observed by the European Union for its member countries.

“We worry about the dire consequences that such fiscal imbalance could have on the economy and the flagship Build Build Build program of the current administration,” the groups said.           

The business organizations made the appeal after economic managers in the Department of Finance, Department of Budget and Management, National Economic and Development Authority, Bangko Sentral ng Pilipinas and researchers of PIDS openly shared their analysis and aired their concerns to the public. The groups praised these economic managers for their efforts.

“We support and join their call for a more detailed analysis of the fiscal impact of federalism to serve as basis for the deliberations in Congress,” they said.      

“We encourage full, open, and dispassionate dialogues on  this proposed shift in form of government,  keeping in mind its long-term  impacts on future generations of Filipinos.”

Thr groups vowed to work with the political and economic leaders to bring sustained and inclusive economic growth in the country.

On Thursday, a member of the Consultative Commission asked President Rodrigo Duterte to fire Finance Secretary Carlos Dominguez III and Socioeconomic Planning Secretary Ernesto Pernia over negative statements about the shift to federalism. — Rosette Adel

As It Happens
LATEST UPDATE: December 16, 2019 - 1:57pm

The consultative committee, tasked with drafting a new constitution, eyes the removal of the impeachment power of Congress over justices of the Constitutional Court, one of the proposed three Supreme Courts under the draft charter.

READ: Concom eyes 3 supreme courts

Concom proposes that the impeachment of justices in Constitutional Court be decided instead by the 15-member Supreme Court.

The proposed Constitutional Court will have a presiding justice appointed by the Supreme Court and six associate justices with two appointees each from three branches of government.

LIST: Controversial features of proposed federal charter by House sub-committee

— with Edu Punay

December 16, 2019 - 1:57pm

An attempt at the House of Representatives to change the 1987 Constitution to give local officials five-year terms will not prosper in the upper house of Congress, Senate Minority Leader Franklin Drilon says Monday. 

"If the House of Representatives would insist on passing Cha-cha, make it a point to include their return address, because the Senate and the Filipino people will not accept it," he says in a press statement.

He says charter change is not among the Senate's priorities, echoing an earlier statement from Senate President Vicente Sotto III.

The House committee on constitutional amendments reportedly approved in a closed-door meeting last week a resolution that would give House members and other local officials five-year terms from the current three-year terms.

The same resolution also adds the phrase "unless otherwise provided by law" to economic provisions in the charter.

July 23, 2019 - 10:56am

Senate Minority Leader Franklin Drilon notes the omission of charter change and federalism from President Rodrigo Duterte's 4th SONA, saying the president's silence on the campaign promise "speaks volumes."

"For me, the non-inclusion of federalism indicates that the [charter change] was laid to rest yesterday. The SONA became cha-cha’s ‘final resting place,'" Drilon says.

 Attempts to amend the 1987 Constitution during past administrations have failed and attempts towards the end of a sitting president's term have suffered from a perception that these are attempts to do away with term limits and to stay in power.

"Hence, those who have plans to revive it this 18thCongress should better think twice. It will be an exercise in futility," he also says.

July 9, 2019 - 3:20pm

The 2022 elections are not too far away too affect how attempts to amend the 1987 Constitution, Senate Minority Leader Franklin Drilon says, adding the presidential polls will be "the biggest factor" in a renewed bid for charter change.

"It is difficult to predict at this time how the senators will vote considering the new composition of the Senate. But what is becoming clear is the presidency in 2022 will play a huge role in how our colleagues will treat this renewed call for Charter change and decide on their vote," Drilon says.

Attempts to amend the constitution during past administrations have failed, partly because of fears that the sitting president would use the amendments to skirt term limits in the 1987 charter.

A 1997 attempt to shift to a parliamentary system through a signature campaign was stopped at the Supreme Court, which decided that the people's initative could ony be used for constitutional amendments and not revisions. Another attempt in 1999 failed to gather popular support and Joseph Ejercito Estrada, president at the time, was ousted in 2001.

Several attempts were made during the presidency of Gloria Macapagal-Arroyo but were met with protests by the political opposition who opposed Arroyo of wanting to stay in power for longer than the nine years that she sat as president.

An attempt to amend the economic provisions of the constitution during the Aquino presidency only reached approval on second reading.

Drilon points out that surveys in 2018 showed most Filipinos were either unaware of attempts to amend the constitution or did not support amending it.

"I don't think that people had a change of heart in the past months for them to favor Cha-cha. It is clear that Filipinos do not see charter change and federalism as the solution to the problems of hunger, poverty, unemployment and lawlessness," Drilon says.

June 30, 2019 - 2:16pm

The Palace has not given up on the campaign to shift to a federal form of government despite President Rodrigo Duterte saying he is fine with changing the 1987 Constitution even if that does not lead to a federal form of government as he porimised in the 2016 campaign.

"Palagay ko, di mawawala yan. May tatlong taon pa naman tayo (I think that won't be forgotten. Me have three more years to work on it)," presidential spokesperson Salvador Panelo says.

June 30 marks the halfway mark for the Duterte presidency. Under the 1987 Constitution, presidents can only serve one six-year term. — with a report from The STAR/Alexis Romero 

March 21, 2019 - 3:42pm

The military's Western Mindanao Command said it respects Moro National Liberation Front founding chairman Nur Misuari's supposed threat to go to war if the Philippines does not shift to a federal government as an expression of frustration.

"Everyone has the right to express. If the president can tolerate it why can’t we? Right?" says Col. Gerry Besana, Westmincom spokesman, in response to Misuari's supposed statement. Westmincom operates in the Bangsamoro Autonomous Region in Muslim Mindanao, which includes Misuari's home province of Sulu.

RELATED: Duterte told Misuari they would 'die together' if federalism talks fail, Palace says

He says, though, that it will be a different matter if Misuari actually makes good on his supposed threat.

"We know he is capable of doing it. But if he will do it again it will be another case. We have to understand we are in Martial Law in Mindanao. If any act of violence will be committed there will be corresponding action or contingency that is prepared by the military," Besana says.

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