"Augmenting local budget for infra"
A country’s economic development may be directed by the manner of spending and budget allocation by the government. This administration’s Build, Build, Build program has provided the needed stimulus for economic growth. To finance this promising endeavor, tax reforms have been implemented.
The government also exerted more efforts to encourage entry of foreign investments and facilitated export of manpower to foreign countries, which have been the main drivers of our economic growth, to increase national revenue and capacity of the government to pay off its foreign debts. The Bangko Sentral ng Pilipinas reported that OFW remittances were at record high in 2019, amounting to over $33 billion, with $3.21 billion recorded in December 2019 alone.
Despite this, major government projects such as the Build, Build, Build are still limited in their budget. In effect, the potential of these programs are not realized and their contribution to economic growth is not optimized.
We need to take a look at this issue. When I was still in Congress as Minority Leader, I would often say that the reason why we have this perennial issue in budget allocation is that we are limited in the amount of money that can be spent. Hence, we need to wisely allocate the funds where our economy can benefit the most.
Let me offer a solution. Given that the total recorded remittances in the past year were more than enough to amortize our foreign debt, we should allocate the excess amount in the budget to programs such as the Build, Build, Build where we would benefit the most through better road networks, increased employment, and, eventually, accelerated economic growth. To facilitate inclusive growth for the regions, the government should consider distributing these revenues to the corresponding local government units of workers and businesses to support infrastructure projects in their barangays, municipalities, and provinces. This shall serve as a supplement to the internal revenue allotment (IRA) given to local government units (LGUs). This is the least that we can do to benefit the families of these Filipino workers, by ensuring and providing improved road networks and public welfare programs in their locality.
Considering the COVID-19 crisis, the government will also be needing funds to facilitate the building of quarantine centers and other necessary infrastructure in different parts of the country. The IRA is not enough for LGUs to rehabilitate their communities. Hence, this additional allotment would be most useful to equip LGUs and allow them to build necessary facilities to better manage COVID-19 in their areas.
Finally, as most of the country ultimately transitions to a General Community Quarantine, the resumption of the Build, Build, Build program will be advantageous to both the government and the community, provided that the program adopts employment of locals in the areas where projects are located. This is to give employment opportunities to residents and help control the spread of COVID-19 by limiting the entry of non-locals in cities and municipalities. In the long run, I hope that this proposal will be adopted by the national government to decentralize and distribute economic activities and help attain inclusive and equitable growth.