Life after ‘wang-wang’

Opinion
Written by Liling Magtolis Briones / Boiled Green Bananas
Business Mirror, Sunday, 11 July 2010 20:03


Finally, interest in wang-wang is fading after two weeks of intense media focus and public attention. Debates (including in Facebook!) on whether wang-wangs are in the national interest have simmered down.

People have stopped getting curious about the President’s promptness or lack of it when he goes to Malacañang or visits different offices. What a relief it is to move on to other issues! Wang-wang does not mean anything to most Filipinos who are in the countryside. It was largely a debate among Metro Manilans, while the rest of the country is disinterested, bored and excluded.

Inventory of public finances

The new financial-management team is doing the right thing. It is conducting an inventory of the state of public finances, both on the revenue and expenditure side. Judging from partial reports announced in the press, revenue collections continue to fall short of projections while certain budget balances are perilously low. This can only mean that the deficit is escalating. The findings confirm earlier suspicions.

While periodic reports on revenue collections always mention the shortfalls, those on public expenditures do not necessarily give details. Thus, it is difficult for interested citizens to determine whether the government is spending beyond the budget. They have to wait until the full year audit is out. The public is now asking, “May pera pa ba?” and “Magkano na ang utang”?

The state of GOCC and GFI finance

The Saturday papers have come out with worrisome news about two government-owned and -controlled corporations (GOCCs). Finance officials were aghast to learn that the National Food Authority (NFA) has accumulated P171 billion in debt, compared to P28 billion six years ago.

One of the late Armand Fabella’s sayings is that the NFA is “born to lose.” It is among the GOCCs which were created precisely to lose. This is because it has to buy rice from farmers at subsidized costs and sell this to the public, also with a subsidy. It is not in the business of making profit. Nonetheless, an inordinately huge debt like this is a source of concern.

The multilaterals have been recommending the abolition of NFA several administrations ago.

Another GOCC which has purportedly amassed a mountain of debt is the Philippine Amusement and Gaming Corp. (Pagcor). If true, this is certainly surprising. Pagcor bills itself as the “third-largest revenue earner of government.” There is no reason for it to lose, since its income stream is steady. People gamble in times of crisis and prosperity.
Pagcor is a major source for the President’s Social Fund. Oftentimes, its contributions are not coursed through the national budget but go directly to the Office of the President.

It will be useful to trace all its expenditures, especially during and immediately after the election period, when large withdrawals were reportedly made from Pagcor funds.

The public has already some idea as to revenues and expenditures in the national budget. What they are not aware of is that the public-corporate sector is larger than the national government in terms of assets, and financial position. The dimensions of total government corporate debt are usually larger than that of the national government.

An immodest proposal

Government financial reports are usually prepared at the end of a fiscal period. Since a new administration has taken over, it might be good to have an official, semiannual report on the financial status of the government. Perhaps, it can be done by Commission on Audit and consolidated by, say, the Department of Finance. It need not be as comprehensive as the annual audit report. What is needed is the state of balances in public finance—balances in the budget, actual viz programmed expenditures, status of revenue collections, and the magnitude of public borrowing.

Course for new legislators opens July 12

The Center for Policy and Executive Development of the UP National College of Public Administration and Governance (NCPAG) is offering a special course for new legislators starting July 12, and ending on June 16. The course director is Prof. Leonor Magtolis Briones, senior faculty and former treasurer of the Philippines.

The course is designed to give party-list and district legislators a broad overview of their role as members of Congress. Subjects include policy formulation, the appropriation and budget process, dialogues with marginalized sectors and sharing of experiences with successful legislators. The faculty roster includes practitioners, as well as experts from academe.

Those interested can get directly in touch with Prof. Briones at 0917-5359884 or go to Room 307 of UP/NCPAG Building at UP Diliman, Quezon City.