House panel starts 2020 budget hearings
THE House committee on appropriations started on Thursday, August 22, the hearings on the proposed P4.1-trillion national budget for 2020 with a briefing on the government’s macroeconomic assumptions, growth targets and fiscal program.
Bangko Sentral ng Pilipinas (BSP) Deputy Governor Francisco Dakila Jr., representing BSP Governor Benjamin Diokno who is on an official overseas trip, presented the macroeconomic assumptions for the 2020 budget.
Dakila said Development Budget Coordination Committee (DBCC), of which the BSP is part, has set the following assumptions:
* Inflation rate will be at 2.7 to 3.5 percent for 2019 and within the target band of 2.0 to 4.0 in 2020;
* Average Dubai crude oil prices are projected to stay within US$60 to US$75 per barrel in 2019 to 2022, but the committee recognizes that prices are highly volatile and could be influenced by the Us-china trade tension and the weak global economy; and
* The peso dollar rate is seen at P51 to P53 against the US dollar for 2019 and PHP 51 to 55 from 2020 to 2022, noting the recent policy easing in several Asian economies.
National Economic and Development Authority (Neda) Director General and Socioeconomic Planning Secretary Ernesto Pernia, who presented a situation report on the economy, said the gross domestic product (GDP) is still projected to grow by 6.0 to 7.0 percent in 2019.
GDP, the value of all goods and services produced in a certain period, is also seen to grow by 6.5 to 7.5 percent in 2020, and 7.0 to 8.0 percent in 2021 and 2022.
Finance Undersecretary Gil Beltran, representing Department of Finance Secretary Carlos Dominguez III, presented the government’s revenue performance and collection targets.
He said revenue collections are projected to reach P3.15 trillion in 2019, equivalent to 16.4 percent of GDP.
In the first half, collections reached P1.5 trillion, an increase of 9.7 percent. Of the total, 89.2 percent came from tax collections
Expenditures, on the other hand, are targeted to hit P3.77 trillion in 2019, which is equivalent to 19.6 percent of GDP.
For 2020, Beltran said revenues are projected to increase to P3.54 trillion, equivalent to 16.7 percent of GDP, while disbursements are programmed at P4.21 trillion or 19.9 percent of GDP.
Revenue and disbursement projections are estimated to rise to P4.42 trillion (17.2 percent of GDP) and PHP5.24 trillion (20.4 percent of GDP), respectively, by 2022.
With these assumptions, he said the deficit target will be maintained at 3.2 percent of GDP from 2019 to 2022.
Beltran cited the need to pass the remaining tranches of the government’s Comprehensive Tax Reform Program to “ensure a reliable revenue base.”
“Completing the passage of tax reform will ensure a steady revenue flow and equitable sharing of contributions for
the government’s social and infrastructure programs while securing fiscal stability long into the future,” he said.
The proposed 2020 budget of P4.1 trillion is 12 percent higher than the 2019 budget.
Acting Budget Secretary Wendel Avisado said P1.255 trillion has been allotted for personnel services, P1.587 trillion for maintenance and other operating expenses, P804.2 billion for capital outlay, and P452.4 billion for financial expenses.
Allocations by sector show the biggest amount of P1.525 trillion will go to social services, P1.18 trillion for economic services, P734.5 billion for general public services, P451 billion for debt burden, and P195.6 billion for defense./sunstar Philippines