News TOP

News Detail

Approved Senate bill requires Palace men to render biannual State of Debt Address



As the government piles up debts without congressional review, a law requiring the country's lead economic managers to make a biannual appearance before a joint committee of Congress to report on the country's debt and finances "has become more urgent."

"Kung may Ulat sa Bayan ang Pangulo, kailangan may Utang ng Bayan report din ang mga tao niya," Senate President Pro Tempore Ralph Recto said.

With the "national debt meter moving up but without us knowing the details," Recto stressed the importance of a Senate-approved bill mandating four Cabinet men to make two "national fiscal status" reports before a House-Senate oversight panel in a year.

Explaining Senate Bill 1483, Recto said those who will render "what is essentially a SODA, or State of the Debt Address" are the DOF and DBM Secretaries, the NEDA Director General, and the Bangko Sentral Governor.

Recto urged Congress to take an active stance in closely monitoring the enlargement of the public debt. "Our eyes should be on the debt needle."

He based his call on "the alarming trend of finding foreign financing, signing the loan papers, and passing, as a matter of fait accompli, the loan repayment to Congress--instead of first securing appropriations for a certain project or program," he said.

"Isang halimbawa diyan yung sa CCT, sa 4Ps. Hindi alam ng taumbayan na $1.75 billion dollars, in five loan packages na ang nautang. Ang dumating na lang sa Kongreso, yung pambayad utang, yung kailangan for debt servicing. Parang, 'Oo nga pala, we borrowed this amount, so pay this,'" he said.

"There is always the temptation of going on a borrowing spree and letting the succeeding administrations pay for it. Kung ganoon ang siste, future income is mortgaged, and budget space is constricted," he said.

While the most important debt indicator - the debt-to-GDP ratio - has been going down, from Arroyo to Aquino to Duterte, or from 52.4 percent in 2010 to 42.1 percent last year, "we should not let up in our oversight because loose loan approvals will create payables the next generation will amortize."

"Historically, okay 'yung downward trajectory ng interest payments, as share of national budget. In 2004, 30 centavos for every budget peso went to interest payments. Last year, about 9 centavos na lang. But we should be wary of any backsliding," Recto said.

The national government debt was P4.582 trillion as of June 2010, the month Gloria Arroyo stepped down from office. It was P5.94 trillion in June 2016 when it was Benigno Aquino III's turn to leave Malacañang. This has climbed to P7.15 trillion by end of last September.

"But not fully included in the debt picture are contingent liabilities arising from sovereign loans or guaranteed obligations in PPP projects, and embedded in various kinds of joint ventures," he explained.

"There should be a reliable, running estimate kung magkano ang mga ito. Otherwise kapag pumutok, blindsided tayo," Recto said.

www.senate.gov.ph