(Eagle News) – Budget Secretary Benjamin Diokno warned of “detrimental” effects to the country’s economy in case Congress fails to approve the proposed 2019 national budget of PHP3.757-trillion.
According to Department of Budget and Media estimates, a reenacted budget would reduce disbursements by around PhP220 billion by 2019.
Diokno said the growth impact of such a reduction would be “detrimental” and could lead to an economic slowdown.
“While ‘the sky will not fall down’ as Congressman (Rolando) Andaya claimed, the growth impact of such a reduction would be detrimental,” according to the budget chief.
He said that this could result in the reduction by as much as 600,000 jobs in sectors such as construction, public administration and defense, wholesale and retail trade, land transport and education.
“It is also estimated that 200,000 to 400,000 individuals could be pushed into poverty following the contraction of the budget,” a DBM release said.
“We have the numbers,” Diokno said to counter the House Majority Floor leader’s downplaying of the effects of a reenacted budget.
-Negative GDP growth feared-
“Our growth targets are anchored on a carefully-crafted expansionary fiscal policy,” he said.
“If you reduce the budget, you interrupt our growth momentum.”
Latest NEDA estimates showed that a reenacted budget could have a negative growth impact on the economy, particularly on the Gross Domestic Product (GDP). The range of negative growth next year could be from negative 1.1 to negative 2.3 percent.
“I have previously served two other Presidents, and I have not seen the stars align like it has for this one. With steady and relatively stable growth, we have a golden opportunity here to bring our growth even further by investing in infrastructure and human capital. We would be wasting that opportunity if we reenact the budget,” Diokno said.
