Budget Secretary Florencio “Butch” Abad. INQUIRER FILE PHOTO
The Palace is preparing to ask Congress for a national budget next year that will be hitting for the first time the P2 trillion mark.
Budget Secretary Florencio Abad said Tuesday the Department of Budget and Management will finalize its budget proposal for 2013 this week then submit it to President Benigno Aquino and the Cabinet.
The government is currently working on a P1.816-trillion national budget.
Next year is an election year.
“There is no final number yet on the budget … It will hover around P2 trillion,” Abad told reporters in Malacañang.
He said the Development Budget and Coordinating Council will meet on Friday to review the macroeconomic assumptions needed for them to determine the ceiling for the proposed budget.
Under the proposal, the budget will be funded “for most part” through tax revenues, Abad said. Much of the funding will go to infrastructure and social services, he added.
“We will have even bigger investments in infrastructure, excluding Public-Private Partnership programs,” he added.
“We intend to propose to the President a higher level of spending in infrastructure since we are committed to finishing the construction of national arterial roads by the end of 2014 as well as closing the classroom gap of 65,000 by the end of 2013 and also achieving rice self-sufficiency by end of 2013 which would mean continuing with the vigorous spending on agricultural infrastructure,” he said.
The government also plans to increase the budget of the Conditional Cash Transfer program by P40 billion next year to accommodate half a million more poor families, according to Abad. The program, which provides subsidies to poor families on condition parents send their children to school and bring them to health centers for checkups, hopes to reach out to three million families by the end of 2012.
Abad said the proposed budget had not yet taken into account the passage of bills on new sin taxes and the rationalization of fiscal incentives.
He said the passage of these two bills will give the government an additional P40 to P50 billion which it can use to invest in tourism infrastructure.
“We have to build more roads that lead to tourism zones as well as arterial farm to market roads that lead to production zones,” the budget secretary said.
Abad also said it was “premature” for the government to revise its growth targets for next year even if the economy grew by 6.4 percent during the first quarter of the year.
“While we are confident that the 6.4 (growth) is not really a fluke … one quarter does not establish a trend for the whole year,” he said.
He said the government was doing its best to ensure that the 6.4 percent growth of the economy would be sustained.
Abad predicted “more vigor” in the coming months based on domestic demand and private sector consumption. “That seems to be the driver,” he said.
Originally posted: 11:08 am | Tuesday, June 12th, 2012