Only P2.5B out of P72.5B for COVID-19 vaccines has immediate funding
MANILA, Philippines — While Senate and House leaders on Wednesday agreed to earmark P72.5 billion for the purchase of coronavirus vaccines in the 2021 budget, only P2.5 billion could be immediately funded as the bulk was lodged in standby funds heavily reliant on foreign borrowings.
The allocation may also not be enough to inoculate even half of the 70 million Filipinos needed for “herd immunity,” Senate President Pro Tempore Ralph Recto said, referring to the level of protection from disease enjoyed by a population once enough people had been vaccinated.
60 million doses
The P72.5-billion appropriation can buy more than 60 million doses of the COVID-19 vaccine based on the Department of Finance’s (DOF) cost estimate of $25, or P1,200, per complete dose.
Last month, Finance Secretary Carlos Dominguez III gave a lower threshold of 60 million Filipinos who should receive the shots to achieve herd immunity using the planned COVID-19 vaccine fund of P73.2 billion, or a bit higher than what Congress ended up approving.
But Recto noted that each citizen would need at least two doses to be fully vaccinated, as recent successful trials by a number of pharmaceutical companies had shown.
“Unfortunately, the amount may not be enough to inoculate at least 70 percent of our population,” he told the Inquirer.
Besides, he said, there were other costs.
Logistic strategy
The government “will need to pay in advance and to line up for delivery,” as well as to “start investing in a logistic strategy to deliver vaccines nationwide to at least 70 million Filipinos,” requiring even more money, Recto said.
As they wrapped up bicameral talks on the 2021 general appropriations bill, the Senate and House leaders agreed to place P70 billion of the COVID-19 vaccine budget under unprogrammed appropriations, according to Sen. Juan Edgardo Angara, chair of the Senate finance panel.
Unlike regular budgetary items with definite funding, unprogrammed appropriations can only be financed depending on the availability of excess tax collections or new revenue sources, or by borrowing from other countries or multilateral agencies.
Angara said a separate P2.5-billion item was put in the regular budget of the Department of Health (DOH) for its program on the still largely unavailable vaccine, bringing the total to P72.5 billion.
The allocation is lower by P10.5 billion than the Senate version, which earlier proposed P83 billion for the same purpose, consisting of P8 billion in programmed appropriations under the DOH’s vaccine program, P54 billion for the purchase of the drug, and P21 billion for storage, transportation and distribution.
Bayanihan extension
But Angara said another P10 billion should be available for COVID-19 vaccines under the Bayanihan to Recover as One Act or Bayanihan 2, assuming Congress was able to pass a law extending its validity until June 2021.
Enacted in September, Bayanihan 2 set aside P140 billion in regular funding for various programs to stimulate the distressed economy, plus P25.5 billion as standby fund, including P10 billion for both COVID-19 tests and vaccines.
That, according to Angara, leaves a total of P82.5 billion for the COVID-19 vaccine program once the GAB is passed into law.
The Senate and the House of Representatives were expected to ratify the P4.5-trillion budget measure on Wednesday, giving the President plenty of time to sign it into law before the end of 2020 and avoiding a reenacted budget.
‘Unprogrammed’
Facing reporters after the bicameral budget conference, Angara expressed optimism that the entire P72.5-billion budget for COVID-19 vaccines would be “fully utilized” in 2021 despite much of it being unprogrammed.
“Others may think that just because it’s unprogrammed, it will no longer be funded, but that’s not true,” he said. “The probability of it being funded is large. We were assured by the [DOF] that it will really be funded.”
Pressed to explain, the senator only said the economic managers were banking on “nontax revenues.”
“That’s the reason why there’s a big probability of being funded,” Angara said.
Asked how Congress could ensure availability of funds for the unprogrammed allocation, he replied: “If you’re talking about availability of cash, that’s not for the legislative [to answer]. That’s for the executive to answer. We do not collect money.”
Recto also found “nothing wrong” with using unprogrammed funds “knowing we will borrow the money.”
3 likely fund sources
Dominguez had identified three likely sources for the government’s planned COVID-19 vaccine fund amounting to P73.2 billion.
The first is P40 billion in “low-cost, long-term loans” from multilateral institutions such as the Asian Development Bank and the World Bank.
Some P20 billion may be tapped from domestic government financial institutions, such as Land Bank of the Philippines, Development Bank of the Philippines, and government-owned and -controlled corporations.
The last is P13.2 billion to be sourced from “bilateral negotiations” with countries from where the vaccines would originate, such as the United States and the United Kingdom.
“Most of it is already fixed,” Dominguez said. But he acknowledged that the P13.2 billion “is not yet completely negotiated.”
