The incoming administration of presumptive president Ferdinand Marcos Jr. may not have funds it will need for its stimulus package as the outgoing Duterte administration has already disbursed 90 percent of the 2022 national budget, Albay 1st District Rep. Edcel Lagman said Sunday.
“Unless the new administration can find or create fresh funds, the stimulus package monikered as Bayan Bangon Muli will be mere sloganeering and simply a change in nomenclature from the original Bayanihan,” Lagman said in a statement.
“Unlike in Bayanihan 1 and 2, there is nothing more to be realigned in the 2022 national budget because 90 percent has already been released to departments and agencies,” he said.
While there are special purpose funds, these are “untouchable as they are mandatories like salaries, pensions, and for the National Disaster Risk Reduction and Management Council Fund or the calamity fund,” Lagman said.
Albay 2nd District Rep. Joey Salceda, chairman of the ways and means committee of the House of Representatives, earlier said the incoming administration would need around P326 billion in new revenues every year to cover both principal and interest payments due to debts incurred during the COVID-19 pandemic.
To achieve this, Salceda cited the need for Congress to enact new packages of tax policy reforms.
“Unless we can raise that kind of revenue, we will have to downscale our public spending or borrow again to pay the debt,” Salceda said in a statement.
Stressing the need for quick and effective fiscal measures, Salceda added: “The earlier the Marcos administration starts with a fiscal expansion program, the better it will be for investor confidence, our credit ratings, our debt overhang, and our future growth prospects.”
“You need money for the most important campaign promises: cheaper rice, more efficient government services, and improved agriculture.”
“So, I would suggest quick and effective fiscal measures being undertaken in the first hundred days,” he said.
Meanwhile, Salceda said the debt service due to deficit spending from January 2020 to March 2022 would have been around P144 billion in principal payments over the next 20 years, and around P181 billion in interest payments.
“That will of course vary per year, and some years will need lower debt than others,” he said. “But if you want to stretch out the payment schedule, that’s the kind of fiscal space you need to cover the COVID-19 debts without incurring budget cuts.”
“And of course, the P326 billion figure relies on current interest rates. To keep them at this level, we need to show our creditors we are in good fiscal standing. So tax policy reform is really our best option,” he added.