In whose hands is public money safer?

Christmas truly is the deadliest season in RP. The health department says that strokes, heart attacks and accidents, the No. 1, 2 and 4 leading causes of deaths, spike in mid-December to mid-January. Food and alcohol bingeing trigger the first two; fires, firecracker explosions, sea disasters and road crashes comprise the third. Accidents arise from lack of safety culture and law enforcement, overloading of ships and electrical outlets, and drunk and fatigue driving. All are preventable yet Filipinos don’t seem to care.

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In whose hands is public money safer — creditors’ or legislators’? The question rises from what senators and congressmen did to the 2010 national budget. Last week they passed a P1.541-trillion spending program, with no quorum but with an odd feature. Automatic appropriation for debt interest payment was cut by P65 billion. The amount was then spread among the usual pork barrel agencies, for release in January-March in the thick of the election campaign. So, will the P65 billion be put to better use if paid to domestic and foreign lenders, or disbursed for legislators’ pet projects?

In theory scarce public funds would be better spent on government services than on debt servicing. Government must ensure people’s needs: food, jobs, education, homes, health, and infrastructures. Spending on these basics spreads cash around, stirring the economy. Payment of principal and interest of rightful and onerous loans boosts only the government’s option to re-borrow. The money goes to bank vaults, mostly abroad. RP’s foreign debt stood at $53.1 billion (P2.65 trillion) as of September. It owes domestic lenders another P2.05 trillion.

Legislators claim that pork barrel spending is precisely for the six basic needs. Maybe so. But it’s no secret that their buying of farm fertilizers, library books and medicines for constituents comes with kickbacks. Same with their spending for labor-intensive projects, mass housing, and road paving. Some of the money does go around to kick up economic activity. But the bulk ends up in their pockets, to splurge overseas on lavish travels, secret mansions, and children’s schooling. In an election year the projects from which legislators steal may not even be as necessary to constituents as these are for vote buying.

This is the second year legislators broke an old Marcos decree on automatic appropriation for debt servicing. In 2009’s P1.12-trillion budget they also took out P35.3 billion from interest payment. It was moved to the Departments of Public Works and Highways, Transportation and Communications, Agriculture, Education, Health, and Social Welfare and Development. From there it was disbursed to senators and congressmen’s preferred projects. President Arroyo consented; she vetoed only a rider for her to clear with them any allocation transfer from one project to another.

Past Presidents had never let Congress touch the automatic funding. But for 2010 the bicameral budget committee, co-chaired by Sen. Edgardo Angara and Rep. Junie Cua, was emboldened by last year’s tinkering. Dumping figures from the National Economic and Development Authority, they made their own assumptions on interest and foreign exchange rates. From there, they concluded that projected interest payments were over-computed by P65 billion. So they simply moved it to hidden pork barrels, and requested that Arroyo “front end these”, that is, release the money in the first quarter.

The realignment was done on the sly. The Senate and House ratified the 2010 budget without reading the fine print. In fact, the Senate approved the final version with only Angara out of nine senators in the bicameral committee signing it. Only 30 of 260 congressmen voted in the House, and they did so with no copy of the final figures in front of them. Cua made excuses to not give copies to the press either. “I’ve never seen anything like it,” remarks The STAR reporter Jess Diaz, who has been covering Congress for two decades. Not a word of protest was heard from the minority, or from usually strident opposition senators and leftist congressmen.

The Arroyo administration’s unbridled borrowings and misspending has pushed up the annual budget deficit. Adding the transfer of P65 billion from debt payment to pork barrel, newly resigned NEDA secretary Ralph Recto warns that the deficit would hit P400 billion this year. Former budget secretary Benjamin Diokno foresees it to be worse at P500 billion. This would drive up interest rates, constrict business expansions, and prolong the economic crisis by another two years. “Our economy cannot absorb this,” Diokno shakes his head. The next President will inherit the headache that Arroyo’s admin is creating.

As to where public money would be safer, Diokno wishes that the admin would leave the P65 billion with creditors. In the hands of legislators there could be last minute looting by the outgoing admin, the so-called pabaon (golden parachute). Midnight deals would be concluded before the start of the election ban on government contracting.

What a way for our legislators to greet us this New Year.

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 “You may take the rose provided you are willing to grapple with the thorn. Speak not therefore of love if you evade its pain.” Shafts of Light, Fr. Guido Arguelles, SJ

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