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Urban poor slams Aquino veto of debt cap in 2012 budget

Friday, December 23, 2011

Urban poor slams Aquino veto of debt cap in 2012 budget

The country’s urban poor have one more reason to consider President Benigno an enemy of the poor: he vetoed a provision inserted by the House of Representatives into the 2012 national budget that would have forced the government to put a limit on borrowing funds from foreign sources. The removed provision would also have placed more stringent boundaries on spending for infrastructure and other government projects.

In reports, Budget Secretary Florencio Abad announced that Aquino used his executive prerogative to veto the imposition of a ceiling on public sector indebtedness. Aquino removed the provision before he signed the 2012 budget law December 15.

The said provision reads, “the total indebtedness of the national government and any of its agencies, offices, GOCCs, which carry the sovereign guaranty of the Republic of the Philippines, shall not exceed 60 percent of the latest GDP (gross domestic product).”

It further stated that any borrowing in excess of the ceiling requires prior consent from Congress.

Next year’s budget assumed a fiscal deficit of P286 billion ($6.65 billion) or 2.6 percent of the GDP. This is lower than 2011′s fiscal gap target of P300 billion ($6.97 billion) or 3 percent of GDP.

Abad justified the veto by saying that the public sector debt as of 2010 already stood at 73.3 percent of GDP which is beyond the 60-percent debt cap provision. He also said that the government will continue to utilize unspent funds from the 2011 budget that were originally intended for infrastructure-related projects that did not push through because of various considerations.

A budget obedient to the World Bank’s neo-liberal policies Malacanang’s reasoning, however, did not cut any ice with the Kalipunan ng Damayang Mahihirap (Kadamay). The group’s secretary-general Gloria Arellano said Aquino’s veto of the borrowing and spending limit provision is “A sign of the Aquino administration’s blind obedience to the neo-liberal policies and its thrust to continue borrowing from the World Bank (WB) and other multileral finance institutions.”.... MORE


URL: http://bulatlat.com/main/2011/12/21/urban-poor-slams-aquino-veto-of-debt-cap-in-2012-budget/

1 comment

Anonymous said...

Chains of enslavement.

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