Cash for constituents

Tis the season for giving gifts, and local governments are no exception. These recent weekends, different local government levels--from the barangays to cities and towns--gathered selected groups to distribute cash gifts. Senior citizens and public school teachers (at least in some areas, like Cebu City) received anywhere from P500 to P5,000 each. No doubt the amount adds a bit of cheer among those who received it. Let’s not begrudge the recipients the benefit they may get, whether the amount ends up paying for a Noche Buena dish, gifts for the beneficiaries’ loved ones or maintenance medications. Yet in most cases, the benefit is likely to be short-lived.

Whenever government hands out cash to constituents, some questions arise: (1) Are mechanisms in place to make sure the funds reach actual beneficiaries, instead of ending up in the pockets of those wily enough to conjure “ghost” recipients? (2) Are the funds drawn from the correct sources, without compromising another public good or service for which these could’ve been used? (3) Is giving away cash handouts a sustainable way to spend public funds, which are almost always limited?

The first question is one that interests the Commission on Audit (COA). In 2016, COA reported, more than 20 of 80 barangays in Cebu City failed to explain how they spent some P15.98 million in “various financial assis- tance” from City Hall. Fortunately, the City’s pre-audit section returned liquidation reports to the barangays and asked them to submit the required supporting documents. The second question has also provoked warnings from COA, whose auditors have seen funds for mandatory items getting spent elsewhere, like Gender and Development funds that ended up in senior citizens’ pockets.

The third question is hardest to answer. Some handouts, like conditional cash transfers, may be justified because these are tied to specific and essential objectives, like keeping more children in school and improving the health of expectant mothers. When then-President Gloria Macapagal-Arroyo introduced conditional cash transfers, there was already a body of evidence that showed these to be effective. Cash transfers are, in a way, incentives for responsible behavior, in addition to being social protection measures.

Cash gifts are different. How is giving teachers a hardship allowance better than investing in infrastructure that will make public schools more accessible and public roads, less hazardous? Which is the wiser use of public funds: giving seniors cash or equipping public health centers better to care for them? Lucky are local governments that can afford to do both. For the rest, it’s a matter of making tough and potentially unpopular choices.