Since the government first announced the Bayanihan to Heal as One Act (Republic Act No. 11469) last March, there has been widespread confusion around the size, sources, and breakdown of the country’s Covid-19 response and relief budget.
It was for this reason that Ken Abante, research faculty at the Ateneo University’s Department of Interdisciplinary Studies, decided to launch the #COVID19PH Citizens’ Budget Tracker—a citizen-led initiative that aims to “[promote] accountability and [make] sure our funds to address the Covid-19 crisis are spent properly and timely.”
The publicly-accessible spreadsheet at the core of the initiative is an impressive feat of community engagement. There are currently over 50 volunteers who work with Ken to regularly update and refine this tracker.
To the numbers-averse, however, the technical jargon and elaborate tables featured in the master file may seem a tad intimidating. Hence, this explainer.
So what have they found? Below are the three key points that everyone should know.
1. It is time to move on from Php275 billion.
The most commonly cited figure when talking about the government’s Covid budget is Php275 billion. This was the budget that was initially proposed when Congress was deliberating on granting the president emergency powers back in March.
However, we have since surpassed this number. The budget specified by the Bayanihan Act is actually larger than this, totaling Php380 billion. This sum breaks down as follows: Php270 billion for social amelioration, Php73 billion for health, and Php37 billion for assistance to local government units (LGUs). With his emergency powers, President Duterte has the authority to increase and add to these buckets of spending if he deems it necessary, by realigning additional portions of the original 2020 National Budget as well as savings from 2019.
2. We have enough cash… for now.
Now that we have clarified the size of the budget, the next step is to ask whether the government has enough cash in its coffers to pay for all this expenditure, and from where it will be sourced. The good news is that in spite of unforeseen spending needs brought about by the pandemic, we do have sufficient cash—around Php1.5 trillion at that. This amount comes from a variety of sources, including Treasury bills and bonds (Php519 billion), the Central Bank (Php320 billion), loans and grants (Php437 billion), government owned and controlled corporations (GOCCs) (Php200 billion) and tax revenues (768 billion).
Here we differentiate between financing and funding, which are often used interchangeably and go hand in hand, but differ in meaning as far as policy is concerned. Simply put, financing refers to capital that is used to pay for projects and programs but must eventually be returned, on top of some interest. This include bills, bonds, and loans.
Meanwhile, funding—which encompasses Central Bank dividends, GOCC earnings, grants, and tax revenues—refers to resources that are considered the government’s own and need not be repaid. In fact, it is also funding that will have to pay for financing over time. This is a critical distinction to make, as we keep in mind the sustainability of our spending agenda.
Another detail worth highlighting is that Php1.5 trillion is not the total cash required by the government at this time or that will necessarily be spent. Rather, it is the total amount that is available for use. While we seem to have more than enough money for now, it can very well run out. As such, we need to continuously track the inflows and outflows of cash, and ensure that it is both sourced and spent judiciously.
3. Only 40 percent of the total budget is reported to have been spent.
The President’s office releases a weekly report outlining the status of government spending. As of May 18, nine weeks after the country was first placed under the enhanced community quarantine, only 51 percent—or Php137.9 billion—of the social amelioration budget has been spent. This corresponds to 83 percent of qualified beneficiaries receiving the first tranche of aid across social welfare, labor support, and farmer and agriculture support programs. The second tranche has yet to be released.
On the health front, only 18 percent of the Php73 billion health budget is confirmed to have been disbursed. The totality of this is accounted for by PhilHealth payments to hospitals. Due to the lack of data, it is unclear how much has been spent on other health interventions, which supposedly cover the setting up of quarantine, testing, isolation, and decontamination facilities as well as the procurement of more test kits, personal protective equipment (PPE), ventilators, and human resources. It is also uncertain whether the Php447 million donation from the Philippine Charity Sweepstakes Office (PCSO) has been received by their 82 intended public hospital beneficiaries.
18 percent may seem like a dismal rate, but note that this captures only the spending that is confirmed; the actual figure is likely to be higher than this. Indeed, this example demonstrates the paramount importance of transparency and access to information in the budget tracking exercise. Without accurate, up-to-date data on health spending, among other areas, it is difficult to discern whether we are spending fast enough to adequately test, trace, and treat.
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And ultimately, the reason why it is imperative to keep track of how quickly our emergency funds are being disbursed, in addition to how they are being spent, is that time has an opportunity cost. Businesses face financial catastrophe and demand relief today. Families are hungry and need food today. Thousands of Filipinos are sick and require treatment today. Any delay in extending support may quite literally spell the difference between life and death for both mom-and-pops and mom and pop.
As we strive to pull our country out of the doldrums and set it on the road to recovery, let us continue to keep track of how swiftly and properly the government is spending our money. Let us stay vigilant and demand access to complete, precise, and updated data. Let us not tire of holding power to account, as it is our countrymen’s livelihoods and lives that are at stake.
Raya Buensuceso is a finance and economic analyst at Polestrom, an infrastructure advisory firm that specializes in public-private partnerships. She was formerly a research fellow at the Asia Center of the Milken Institute, a US-based policy and economic think tank, and graduated from Princeton University in 2017.