“We ought to thank Recto for taking the difficult path, suffer the mortal blow to his political career, because he was looking at the future and necessary long-term good”
LIKE many, my initial reaction to the transfer of unused funds from PhilHealth to the national treasury was, why health?
But I did not write about it because I waited for explanations from DOF Secretary Ralph Recto to justify that transfer of close to P90 billion.
When it was clear from the grapevine that Ralph would replace Ben Diokno as secretary, I met with him over lunch, with Rolly Macasaet and Vince Dizon. One of his first declarations was “no new taxes.”
Neither businessmen nor workers can absorb the impact of new taxes, he said. Businessmen are still recovering from the lockdowns owing to the pandemic. Workers are bedeviled by high inflation, Ralph explained.
“Paano mo tataasan pa ang buwis?” the former NEDA director-general, who lost his seat in the Senate because he championed the need for the value-added tax during the administration of Gloria Macapagal Arroyo, stated.
But Recto in his new hat as DOF secretary has to find the ways and means to fund salaries of the millions of government workers, provide the maintenance and operating expenses of a thousand or so government agencies, on top of making sure we do not default on payments for the interest, let alone the principal, due on the humongous national debt, now P15.69 trillion.
It is a difficult balancing act, but the balance must be done. We cannot continue to grow our deficits while waiting, and hoping for the economy to grow enough to create that balance.
It is easy for us to say we should cut on the pork barrel allocations of Congress.
But as a former legislator, Recto knows how it is for Cabinet members and agency heads to squirm before congressmen who will always prioritize their local concerns and senators who need to be re-elected every six years from whom local government officials expect some gravy to go their way in projects.
But unfortunately in our system of checks and balances, where the public purse is determined by the so-called “elect” of the people, not even a Cabinet member can dictate the right way to do things.
Which is why I can only sympathize with Recto’s plight, as the health sector pins the blame on him for wanting to get unused or “excess” funds from the health insurance agency to the national coffers.
The real problem is why there are even “excess” funds that PhilHealth has not used. I place excess in quotes because there should be none; because under-utilization of funds is not the function of an agency with as important a mandate as PhilHealth.
Recto explains these funds did not come from the contributions of members, and therefore should not be touched for other concerns.
True, PhilHealth is supposed to be a fiduciary fund to answer for the health needs of contributors, but having been grossly mismanaged in the past, and perhaps even now, the treasury has had to grant additional funds by way of subsidy to PhilHealth.
The onus should be on PhilHealth’s leadership to explain to Congress and the public why it has not been using funds from contributions and funds from subsidies to maximize the health insurance benefits of the public it serves.
I had a double angioplasty 12 years ago. When the bill came and I discovered to my dismay that what could be charged to PhilHealth was a pittance, I decided to pay completely out-of-pocket. I was hospitalized almost three years ago for COVID; same thing. My regular check-ups as well.
But people with less means have to rely on PhilHealth, and hospitals all over the country need to maintain their services through timely reimbursements from the agency, which is usually long in coming, creating distortions in the cash flow of these private hospitals.
Secretary Recto finds himself in the eye of a storm, the tail of which could make a politician like him suffer in the end, as it did when he sponsored E-Vat some two decades ago.
But these days, one would shudder to think how our economy could have suffered and our growth suspended, nay, stagnated, if not for the ways and means accelerated by the value-added tax.
These days, we ought to thank Recto for taking the difficult path, suffer the mortal blow to his political career, because he was looking at the future and necessary long-term good.
We are in a country where the engine of growth is run by three accelerators: OFW remittances; BPOs; and government expenditures.
Nothing much can be expected from foreign investments, the Maharlika hot-air balloon notwithstanding.
Nothing much can be expected from tourism inflows, our current troubles with neighboring China and our helter-skelter promotion efforts being the culprits.
So let’s understand the predicament of Secretary Recto. He cannot continue borrowing, and he does not want government to impose more and more taxes.
It’s not just PhilHealth which has unused funds; many other GOCCs, perhaps less prominent, also have a chronic under-utilization of allocated funds.
