Details of Aquino’s P2.006-T budget for 2013

MANILA, Philippines – A day after President Benigno Aquino III’s State of the Nation Address (SONA), Malacañang submitted on Tuesday, July 24, the P2.006-trillion 2013 budget to Congress.

Compared to the 2012 budget, the proposed budget is higher by P190 billion or 10.5%. It represents 16.8% of the country’s projected GDP. The budget is based on higher growth assumption of 6.0-7.0% and inflation rate of 3-5 %.

Bulk of the budget goes to social services: P698.8 billion, or 34.8% of the total pie.

“This budget is a crucial step in our continuing pursuit of good governance—governance that will give our impoverished countryment the opportunity to lift themselves out of their situations,” President Aquino said in his budget message.

	Levels (Php Billion)	Percent Share
Economic Services	511.1	25.5
Social Services	698.8	34.8
Defense	89.7	4.5
General Public Services	346.1	17.3
Net lending	26.5	1.3
Debt Service	333.9	16.6
Total	2,006.0	100.0

Revenues, Deficit

The government expects to raise P1.78-trillion in revenues. It is equivalent to 14.9% of the GDP and higher by 14.1% from the revised program for 2012.

The government is expecting to increase tax collections to reach 13.8% of GDP. “Tax revenues are expected to grow by 15.7%, with BIR and BoC collections increasing by 16.2% and 14.5%, respectively. While non-tax revenues will be lower at P128.9 billion due to expected lower dividends from GOCCs,” the Budget Message reads.

The revenue projection does not include the impact of the possible passage of two bills: sin tax bill and rationalization of fiscal incentives.

In earlier interviews, House appropropriations committee chair Rep Joseph Emilio Abaya said the sin tax bill—as approved by the House of Representatives—can generate up to P45-B in additional tax revenue every year.

The government also expects to reduce fiscal deficit to P241-billion. It intends to borrow a total of P757.7 billion. Bulk of the borrowings will come from the domestic market, P567.9 billion, “to reduce our economy’s vulnerability to external shocks,” reads the Budget Message.

It will borrow P189.8 billion from the foreign market.

The government also plans to “swap” foreign-denominated bonds, Abad said during a press conference at the House of Representatives.

Allotments could expire

Abad said the 2013 budget also allocated a total of P409 billion for “capital outlay,” the budget item intended for infrastructure. It is 3.4% of the GDP.

Abad said President Aquino designated the Department of Public Works and Highways as the “principal agency” for “all infrastructure projects,” except those with the Department of Transportation and Communications (DOTC).

Abad said allotments will have “one-year life” starting 2013. “We will not tolerate carry over budgets, which results in budgets being delayed,” he said.

Abad also dismissed earlier calls to suspend the implementtion of the Conditional Cash Transfer (CCT) program during the election period. He assured the public that it will be used properly.

“The program will suffer and will be distorted if you induse partisanship in its use. The DSWD is very careful now that it is not an election year–even more so in an election year–to try to insulate the program from partisanship,” said Abad.

Top departments

The Department of Education (DepEd) has the highest budget among government departments.

	2013 proposed
Department of Education	P292.7 billion
Department of Public Works and Highways	P152.9 billion
Department of National Defense	P121.6 billion
Department of Interior and Local Government	P121.1 billion
Department of Agriculture	74.1 billion
Department of Health	56.8 billion
Department of Social Work and Development	56.2 billion
Department of Transportation and Communications	P37.1 billion
Department of Finance	P33.2 billion
Department of Environment and Natural Resources	P23.7 billion

No reenacted budget

House Speaker Feliciano Belmonte told reporters the House of Representatives will schedule budget hearings for the next two months. “We will give everybody the opportunity to go through it,” he said.

Minority leader Quezon Rep. Danilo Suarez was present during the event.

Abaya gave assurances that proposed 2013 budget will be passed on time. “We do not see any possibility of a reenacted budget,” Abaya said.

Unlike the administration of former President Gloria Arroyo, the Aquino administration passed the 2011 and 2012 budgets on time.

“Hopefully, this will become a tradition in all the 6 years of this administration,” said Abaya. – Rappler.com