Reenacted budget

A reenacted budget will not bode well for the economy and the entire nation.

Economic Planning Secretary Ernesto Pernia has already warned that the failure of lawmakers to pass the proposed 2019 budget and the option to operate under a reenacted budget could significantly pull down economic growth to as low as 4.2 percent.

The government is operating on the 2018 national budget of P3.767 trillion, as the Senate and the House failed to reach a consensus on the new one.

Reenacted budget

The National Economic and Development Authority estimated that a reenacted budget until April 2019 would bring down the full-year gross domestic product growth to 6.1 percent to 6.3 percent. A budget passed later in August, meanwhile, will trim economic growth to around 4.9 percent to 5.1 percent. 

A reenacted budget implies that less funds will be available to finance ongoing infrastructure projects and cause a delay in both new and ongoing programs. Public social services will also suffer, specifically the state's unconditional cash transfer and the so-called Pantawid Pasada programs. 

The budget impasse in Congress, in simple terms, will prevent the government from quickly executing programs and projects required by the growing economy. The government of President Duterte will also miss the opportunity to create as much as 180,000 to 240,000 more jobs, and fail to lift as much as 400,000 to 550,000 more Filipinos out of poverty this year.

Pernia has urged lawmakers to resolve their differences over the proposed 2019 budget and immediately pass the appropriations bill. Both chambers of the Congress are still quarreling over the last-minute amendments on the proposed budget after the bicameral conference committee approved its version.

The stakes are high. The country's chief economic planner noted that the Philippine economy had grown at an average of 6.5 percent in the first 10 quarters of the Duterte administration. It is supposed to resume a strong growth trajectory after the inflation rate started to decelerate and stay within the target range of economic managers.

The economy, however, will not expand at the desired rate programmed by the government. It will struggle in reducing the poverty incidence and creating more jobs. Lawmakers, thus, should quickly settle their differences now for the common good.

Topics: Editorial , Reenacted budget , Philippine economy , Economic Planning Secretary , Ernesto Pernia , 2019 budget , National Economic and Development Authority , Congress
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