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“They are now looking for funds to finance priority projects, including for health, education and major public works supported by foreign financial assistance that require counterpart funding.
Critical projects, primarily funded by official development assistance (ODA), are in jeopardy due to legislators’ maneuvers that prioritize their pet projects in the 2025 General Appropriations Act (GAA).
Low-cost foreign loans, primarily intended for infrastructure and social development, require counterpart funding — funds that members of the House of Representatives have instead redirected to their pork barrel projects.
Not only are the key projects delayed, but shelving the contracts for these entail costs for the government.
Last year, the government had to shell out at least P2.2 billion in commitment fees charged by multilateral firms for implementation delays. The fee compensates the lender for the cost of setting aside the allocated loans.
Socioeconomic Planning Secretary Arsenio Balisacan said that among the problems for the inability of the government to draw the ODA loans is the lack of counterpart funds.
Data from the Department of Budget and Management showed about P51.6 billion was earmarked as the government share in the projects’ funding, but only P10.7 billion was released, with P40.8 billion waiting for excess revenues under the unprogrammed allocations.
Unprogrammed funds are those for which the government has no definite sources. Such shortfalls are addressed through more debt, by enhancing tax collection, or sweeping up funds from government-owned and -controlled corporations (GOCCs).
When a project fails to meet schedules in its feasibility study and implementation documents, proponents must go back to the National Economic and Development Authority (NEDA) board and ask for an extension.
Based on government records, most ODA projects are delayed.
Former finance secretary, Phinma Corp. chairperson and CEO Ramon del Rosario Jr., estimated that P731.4 billion in counterpart funds were diverted over the past two years to pork barrel projects.
He blamed most of the diversions to realignments by the bicameral conference committee, where “our esteemed legislators transferred huge amounts from the high priority projects of our national government, underfunding them and redirecting resources toward public works projects in their districts which are poorly studied, poorly identified and largely centered around flood control.”
Since the support for the ODA projects is relegated to unprogrammed allocations, “the Department of Finance is now scrambling to secure counterpart funding for foreign-assisted projects,” Del Rosario explained.
“They are now looking for funds to finance the priority projects, including for health, education and major public works supported by foreign financial assistance that require counterpart funding. These projects were similarly defunded. Now, the Department of Finance is struggling to find resources for these critical initiatives,” he pointed out.
Del Rosario stressed that public funds should be used to strengthen institutions rather than perpetuate dependency.
By balancing profitability with social responsibility, financial managers can drive positive change and be guardians of the nation’s future.
“Let us remember that the numbers in our spreadsheets represent real lives and aspirations. Together, we can help ensure that our nation’s resources truly serve the dignity and well-being of our people,” he said.
The Phinma chair said many of these projects are “poorly studied, poorly identified,” and disproportionately allocated to flood control, which he suggested could be prone to corruption due to challenges in oversight.
Meanwhile, essential government programs, including those requiring foreign financial assistance, are left underfunded.
Through a directive, the Department of Finance has sourced alternative funding sources, tapping institutions like the Philippine Deposit Insurance Corp. and PhilHealth to cover the unprogrammed financing.
The directive, in turn, was based on a provision in the 2024 GAA allowing the DoF to take the “excess funds” of state firms.
All that trouble — from the loss of pivotal projects to the misappropriation of public welfare funds — just to satisfy pork-hungry legislators.
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Credit belongs to: tribune.net.ph
