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Underspending worries Recto

SENATE President Pro Tempore Ralph Recto has warned against “the disturbing trend” of over-appropriations and underspending as  the national budget will jump to P3.767 trillion in 2018, or by P1 trillion, from its 2016 level of P2.682 trillion.

He doubts if agencies have the capacity “to spend their allocations, which essentially are taxes collected from the people.” 

“The budget will balloon by P1 trillion within two years. Can the agencies spend the money in full, for the right things and on time?” Recto told economic managers on their maiden Senate appearance to pitch the 2018 spending program. 

He cited the budget for “Personal Services,” of which, P746 billion was spent in 2016 out of a budget of P794 billion, “or an underspending or over-appropriation of P48 billlion.”

Personal Services or PS is official budget-speak for payroll and other compensation expenditures for employees and pensioners. 

Recto said the same was true in the case of Maintenance and Other Operating Expenses, or MOOE, whose disbursements reached P1.011 trillion out of the P1.127 trillion provided for in the 2016 budget, “or a slippage of P116 billion.”

MOOE covers non-salary operating expenses like utilities, supplies, rent, and grants.

“Even in debts, our request was over. The previous administratiin asked for P392 billion to service this, but only P304 was spent. There was an excess of P90 billion. Although sometimes we deliberately exceeded our forex assumption in computing interest payments,” Recto said. 

But Recto said the worst manifestation of underspending was Capital Outlays, largely infrastructure.

In 2016, he said the Executive Department asked for P1.175 trillion, but managed to obligate P823 billion, or a shortfall of P352 billion. 

“In all, unreleased appropriations reached P63.43 billion in 2016, on top of the unobligated allotments of P544.53 billion,” he said.

“The utilization rate is low,” Recto said. 

“We betray the people when we are slow, or if we fail, in returning the taxes they have paid, through the national budget. The results penalize a people who have the right to expect the things promised in the budget,” he added. 

Recto theorized that the bureaucracy might have reached “peak capacity” in implementing projects and programs. 

He said this could be a result of “a technical deficit,” which in the case of agencies with infrastructure assignments was “due to lack of engineers and technical people.”

Topics: Senate President Pro Tempore Ralph Recto , “the disturbing trend” , Over-appropriations , Underspending , National budget
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