Tweaks shape COVID-leaning 2022 national budget

MANILA, Philippines—As 2021 comes to an end, members of the Senate and House of Representatives had begun bicameral deliberations on the government’s proposed P5.024 trillion 2022 national budget.

The bicameral deliberations started on Dec. 6 in a format obviously affected by the still ongoing COVID pandemic. Some members were physically present at the venue—Garden Ballroom of Edsa Shangri-La in Mandaluyong
City—while others attended through videoconferencing.

According to Senate Finance Committee chair Sen. Sonny Angara, both chambers must approve the bicameral conference report “by Wednesday next week at the latest since both houses of Congress will be adjourning until January.”

READ: Senate, House kick off bicam on 2022 national budget

In this article, INQUIRER.net will detail which projects in the three major sectors—agriculture, education, and infrastructure—have suffered budget cuts in the proposed budget bill approved by the Senate and the House.

DA sees funding cuts

In its version of the proposed 2022 General Appropriations Act, the Senate introduced several amendments that would reduce funding for some projects or programs of the Department of Agriculture (DA), Department of Public Works and Highways (DPWH), and Department of Education.

In a statement released on Dec. 1, Sen. Panfilo “Ping” Lacson listed his proposed amendments which he said would cut “questionable appropriations and ensure enough funding for priority programs.” The statement said Lacson has been consistent in his scrutiny of the budget.

Among the list of proposed amendments submitted to the Senate Finance Committee was a P1.97-billion cut in the DA budget for farm-to-market roads.

Lacson wants that proposed allocation cut from P6.95 billion—in the House version of the proposed GAA—to just P4.98 billion.

In the DA’s proposed 2022 budget, funding for farm-to-market roads would be released directly to the DPWH for implementation.

According to a briefing paper published by the Department of Budget and Management (DBM) and quoting the DA, farm-to-market roads shall give priority to:

• Areas producing corn, high value commercial crops, livestock, and fishery
• Areas where majority of farmers and agrarian reform beneficiaries are located
• Provinces or regions where poverty incidence is high among farmers

The DBM briefing paper said once completed, farm-to-market roads are to be turned over by the DPWH to local government units (LGUs).

But Lacson said the Mandanas ruling of the Supreme Court and Executive Order No. 138 mandated full devolution of functions to LGUs. The Mandanas ruling will increase LGU shares in national taxes.

Lacson noted that there had been no consultation with the DA on increased funding for farm-to-market roads in the House version of the proposed 2022 GAA.

In a plenary debate last month, Lacson questioned the funding used for farm-to-market road projects under the agriculture stimulus package of Bayanihan to Recover as One Act, or Bayanihan 2.

READ: Lacson questions P5B Bayanihan 2 funds used for farm-to-market road projects

Graphic by Ed Lustan

“We noticed releases under Bayanihan 2 focused on farm-to-market roads worth P5 billion. Can you explain the connection between these farm-to-market road releases and the government’s COVID response?” Lacson said during the floor debates.

“I cannot seem to make the connection,” he continued.

Sen. Cynthia Villar, who sponsored the DA’s budget, explained that the appropriations could be for the improvement of logistics.

Reductions for DPWH

Lacson also proposed amendments in some of the appropriations submitted by the DPWH. These include:

• P1-billion deduction from P3.01 billion in MOOE for the routine maintenance of national roads.
• P200-million deduction from P710 million for the routine maintenance of public buildings.
• P500-million deduction from the P1.61-billion allocation for flood control and drainage systems.
• P1.36-billion deduction from P4.56-billion allocation in the central office for preliminary engineering or detailed engineering of various DPWH projects
• P300-million deduction from the P800 million for feasibility study including business case study for potential Public-Private Partnership projects
• P600-million deduction from P1.6-billion allocation for parcellary surveys, land appraisal and titling of public infrastructures (including taxes)
• P500-million deduction from right-of-way payments for various ongoing and future projects
• P100-million deduction from EDSA rehabilitation and improvement
• P500-million deduction in lump sums
• P44-million deduction from each regional allocation for structural improvement of public buildings and construction of evacuation centers, totaling P704 million

Graphic by Ed Lustan

Under the Senate version of the 2022 budget, the DPWH suffered a P25.2 billion budget cut from P698.1 billion approved by the House to P672.9 billion.

READ: Senate hikes health, education funds; cuts budget for DPWH, DOTr

Lower allocation for DepEd

Under the Senate’s version of the budget bill, DepEd received a “lion’s share” of the national budget for next year, according to Angara.

The Senate has increased DepEd’s budget for next year to P596.9 billion from P590.1 billion in the House version.

According to DepEd, while the House had raised the budget allocation for five of its big-ticket projects, it reduced allocations for the following projects:

• 78 percent reduction on the appropriations for the repair of school buildings
• 75 percent reduction on the appropriations for Gabaldon conservation and restoration
• 45 percent reduction on the appropriations for the School-Based Feeding Program
• 39 percent reduction on the appropriations for the acquisition of furniture
• 9.4 percent reduction on the appropriations for the flexible learning options
• 5 percent reduction on the appropriations for the Government Assistance and Subsidies (GAS) for Private JHS

LGUs get huge chunks

Next year, LGUs will receive more shares in national tax allotment (NTA), formerly called internal revenue allotment (IRA) due to the Mandanas ruling.

The Supreme Court granted in 2018 and reaffirmed in 2019 the petitions of Batangas Gov. Hermilando Mandanas and former Bataan Gov. Enrique Garcia Jr., which raised LGUs’ IRA to 40 percent of collections of all national taxes—the Bureau of Internal Revenue’s (BIR) tax take plus the Bureau of Customs’ (BOC) collections of import duties and other taxes.

Currently, LGU’s IRA only comes from two-fifths of national internal revenue taxes collected by the BIR.

The allocations to local government units (ALGU), under the House’s proposed version of the budget bill, were P87.8 billion.

However, the Senate-approved budget slashed the ALGU by P31.5 billion to P56.2 billion.

“We look at the implementation of the Mandanas ruling not just as a transfer of resources but an opportunity to strengthen decentralization and improve social service delivery in the Philippines,” said Ndiame Diop, World Bank country director for Brunei, Malaysia, Philippines and Thailand, in a statement on June 10.

“If this ruling leads to better coordination in planning and implementation across levels of government, taking into account the capacity and needs of LGUs, it could improve the lives of people and communities especially those that far from the country’s economic growth centers,” he added.

COVID-19 response

The DBM said the proposed 5.024 trillion 2022 national budget would “continue to support efforts to address the socioeconomic headwinds brought about by the health crisis” while also helping fast-track economic recovery.

Graphic by Ed Lustan

It said the proposed budget was “crafted for the successful transition to a post-COVID and more comfortable life.”

The proposed 2022 budget, the DBM said, was guided by three objectives:

• Building Resilience amid the Pandemic
• Sustaining Momentum towards Recovery
• Continuing the Legacy of Infrastructure Development

To address the effects of COVID-19, the Senate has earmarked a total health budget of over P230 billion, which Angara said was “much higher” than the P182 billion proposed by the House.

According to Angara, the Department of Health’s (DOH) Health Facilities Enhancement Program received an additional P3.2 billion. The operation budgets for DOH-operated hospitals were also raised to P4.363 billion for Metro Manila and P10.724 billion for those in other regions.

Graphic by Ed Lustan

The Senate also made the following amendments in the DOH’s proposed budget for next year:

• Increased budget of the DOH’s Epidemiology and Surveillance Program and for the operations of the national reference laboratories
• Increased funds for the hiring and training of 25,000 contract tracers for 2022
• Amended special provisions to ensure funding for purchase and distribution of medicines and vaccines

READ: Senate passes proposed P5.024 trillion nat’l budget for 2022

The House, on the other hand, has earmarked an additional P20 billion to the DOH for the procurement of vaccines and booster shots in 2022.

It has also allotted P4.5 billion to fund the special risk allowance (SRA) of health care workers in the country.

TSB