Business

Gov’t spending still below target

Finance Secretary Carlos Dominguez III admitted that state spending last year fell short of the Duterte administration’s target of P4.335 trillion.

By Eileen Mencias

Finance Secretary Carlos Dominguez III admitted that state spending last year fell short of the Duterte administration’s target of P4.335 trillion.

“Government’s total expenditure requirement last year reached P4.205 trillion. This includes the spending mandated under Bayanihan 1 and 2 as well as the continuation,” Dominguez said during the meeting of the Management Association of the Philippines Tuesday.

The Duterte government’s spending plan for 2020 was widely criticized for being deficient and not enough to resuscitate the economy from the impact of COVID-19.

“There is no stimulus program…Government spending in the first eleven months of 2020 is an 11.6% increase from the same period last year. However, this is hardly any different from the 11.4% average annual increase in government spending… said Ibon Foundation, a nongovernment think tank.

The business sector had pushed for ARISE, a stimulus program that would have helped micro, small and medium enterprises stay afloat and allow their employees to keep their jobs with wage subsidies if only it was approved by the country’s economic team.

Many businesses closed down and millions lost their jobs.

“To be completely honest, some of the jobs lost may never return,” Dominguez said at the meeting.

Dominguez said the emerging fiscal deficit for 2020 is P1.36 trillion, much lower than the P1.64 trillion the economic managers envisioned in the middle of last year.

“Measured against the economic devastation from poor pandemic containment—including over-reliance on long and harsh lockdowns and under -investment in effective testing, tracing, quarantines and isolation—government efforts border on the trivial,” Ibon Foundation said.

“The biggest economic less of 2020 is clear—the government has a vital role in economic development especially in times of crises. COVID19 hit the entire world and the difference was in how each country dealt with it,” the foundation added.

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