We need more money

Most of us live on a limited income, we can’t buy everything we’d like to. We’re even restricted in buying everything we should have. We put off buying a new rice cooker because school fees are due. Or, worse, we put off the kid’s schooling because grandpa is sick and needs medicines. Even at a higher level, no new TV because a new fridge for the food is needed.

Governments face the same dilemma. There’s a clamor to pour support into our farmers and fishermen. There’s a cry for much-improved facilities for the schooling of our kids. Ninety-six percent of Filipinos think the government should pay for our medicines. Our national security should be much improved given China’s threats against us. Roads and bridges must be built. The list goes on.

But the money isn’t there for it all. Government revenues aren’t enough and can’t readily be increased without damaging our competitiveness or creating a social upheaval in opposition to higher taxes or fees.

One thing that could help immensely would be to do what the successful countries in the Western world have done: Stop corruption. According to an estimate by Deputy Ombudsman Cyril Ramos, the Philippine government lost around P700 billion annually in 2017 and in 2018 due to corruption. That is equivalent to about 20 percent of the national budget, or the whole of what’s spent on education. That’s a humongous loss.

In the 2022 budget, P1.18 trillion is earmarked for infrastructure development; P788 billion for education; P268 billion for health care, including funds for the National Health Insurance Program; P107 billion for the Pantawid Pamilya Pilipino Program; P102 billion for agriculture; and P47 billion for the judiciary. And that’s just the top needs. That P700 billion lost to corruption could fund everything agriculture needs to be able to feed us all. Or provide truly free health care, or provide a tablet for every child in school. Truly stopping corruption has to be a central goal of the next president. So, we should choose that president carefully.

But that still leaves a shortfall, with no way to fund it, except through more revenues. You get more revenues from a stronger economy where expanded businesses pay more taxes and duties and fees. Where more people enter the tax-paying bracket of workers.

So, doing everything possible to attract new and expand existing investments must surely be of highest priority—a primary focus of the next administration. What this one has done is commendable with five new laws that open up the economy to that investment. But why on earth did they now knock it on the head with modified implementing rules and regulations (IRR) for the private sector’s assistance in building public infrastructure that will turn off any sensible businessmen? My column, “Why in the last two minutes?” (03/24/22), explains why it will. One that stands out is that the private investor must pay any extra cost created by a change in government regulation. No investor will accept that risk. The next president must cancel this ill-conceived IRR.

The Senate can help, too, by ratifying the Philippine membership in the Regional Comprehensive Economic Partnership in its last session in May, as well as passing business-friendly bills still outstanding, so the next administration has the foundation on which to develop rapid growth in the economy. The next president must put generating more revenues at the top of his list so that there’s money to fund all the priorities where money is needed. The first thing that calls for is the appointment of a highly professional, experienced economic team, with a finance secretary that not only has the expertise needed, but the balls (excuse my indelicacy) to stand up to the president to get the team’s way. Secretary Sonny Dominguez had that and was fortunate to have a president who would actively support what his team recommended.

The new president must also appoint technocrats in those departments of priority: education, health, agriculture, public works, transportation, finance, and economy. Also needed are a justice secretary and an ombudsman that will truly go after the corruptors, the big guys, and a police chief who’ll catch them.

I can’t determine a priority of what to fund. All the ones I’ve listed will do the one thing essential: generate revenues. Educated kids will be employable, healthy people will be able to work, agricultural support will provide revenue-generating produce and jobs, and money into the “Build, Build, Build” program will give the infrastructure (hard and soft) for the industry to grow. All need money.

The conclusion is clear. The next president must center everything he/she decides around how to generate more money for these departments to honestly use.

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