The Sona: Where’s the future?

I had planned to write about the Sona this week, but it’s hard to do. The speech was just that: the “State of the Nation.” It had little of what I’d hoped would be there—President Aquino’s vision of the future, what he’d like to accomplish in this year and in the next two. It was a speech to appeal to the general public, and was well-crafted to do so. It did, as all Sonas do, list the achievements of the past year or two. And they are commendable. But we live into the future, not the past.

The country’s business chambers, 17 of them, wrote to him on what they considered important to address if the jobs the people need were to be provided, if the wealth of the country was to “trickle down,” as the latest buzz phrase has it. It was glaring that there was no discussion on these or how the government will generate jobs for the more than 4 million unemployed Filipinos (excluding the underemployed and those who had to flee the country to get a job). The President announced that more Tesda graduates now land a job compared to four to six years ago. But that was it. There was a noticeable absence of discussion on industrial reforms given the recent findings that the country needs to also refocus on manufacturing.

There was lengthy discussion of improved social service programs such as the Conditional Cash Transfer program that now benefits 4 million poor families from only 700,000 families in 2010. And how PhilHealth coverage is much wider. Also, what had been achieved in education, with K to 12 being the outstanding achievement, and the shortages of everything being reduced.

The signing of the framework peace agreement with the Moro Islamic Liberation Front and the subsequent signing of the annex on wealth-sharing are major achievements of this administration. Despite the initial concerns raised by some sectors, the government’s peace deal with the MILF can happen. The President can be given much credit for this. The statement that I thought said it all was when he was discussing progress: He put it down to “trust.” The Muslims trust him. So do 76 percent of Filipinos. And that’s something we haven’t experienced in a long time. It shines through in the high level of confidence and optimism I find in the business community. But it’s a confidence that can quickly dissipate if the President doesn’t start to act on (not just promise or, worse, ignore) the concerns of business. You don’t need conditional cash transfer if you’ve got a job.

The reproductive health and sin tax reform measures that previously languished in Congress have been passed into law. The President must be commended for endorsing these immensely popular and sensible bills. He stood up to the Church and a powerful tobacco lobby. Both RH and sin tax reform are critical to major societal reform.

And he’s apparently prepared to make unpopular, but certainly necessary, decisions. One I particularly support is raising the MRT/LRT fares. It’s absurd that the 30-minute trip from North Avenue to Ayala only costs P14 while the 90-minute (or much, much more) bus trip costs P28. The government has been subsidizing each trip by as much as P45 because of this populist policy. Also mentioned were increases in SSS premiums “to remedy the outflow of funds” and higher power costs in Mindanao—if you want power. It shows that the President is willing to exercise political will and use his enormous political capital to implement necessary but unpopular measures. He needs to do much more of that that’s business-related in the next three years.

He was talking at Congress yet mentioned only 11 measures of priority. This was an excellent opportunity (even the man with the record for absenteeism was there) to ask for support for his priority list, but he didn’t.

And of those 11 (excluding the proposed national budget for 2014), only two will directly improve the environment to attract job-creating investment.

The most important of those is the fiscal incentives rationalization measure, which, if carefully crafted to make the Philippines more competitive, can indeed attract foreign direct investments. But if designed to prioritize revenues to government (as I fear it may be), then jobs won’t be created. Opening up domestic shipping makes all the sense in the world, and is long overdue. But the proposed measure must include reduced port charges as this is where much of the high cost lies.

He didn’t mention the freedom of information bill yet this was a major plank of his platform in 2010. Many have wondered why not when his “straight path” philosophy must include transparency. Nor did he push for the urgent passage of a new law on tax on mining, a sector that can do so much for increasing national wealth—in the countryside where it’s most needed.

The creation of a Department of Information Communication Technology I didn’t expect as he’s still, for reasons no one seems to know, opposed to it despite the obvious need and benefit of supporting what is the fastest growing sector of the economy.

His success at achieving a very strong majority in both chambers of Congress means he can really push for some major, and often unpopular but necessary, reforms. But he’s even said elsewhere that he still doesn’t see the need for more frequent legislative-executive meetings, despite their obvious success when they are held. The wise choice of leaders in both the Senate (a 17-6 win) and the House (a whopping 245 supportive vote) means we can see the reforms promised, but they weren’t mentioned.

It was a State of the Nation even if through slightly rose-colored glasses. It wasn’t a vision for the future, which would be far more useful to us. He should present that vision now.