MANILA - Noting the 2010 national budget is dependent on heavy borrowings, former national treasurer Leonor Magtolis Briones on Monday expressed alarm over the government’s plan to borrow more money thrice the amount of the deficit target next year.

Briones, lead convenor of Social Watch Philippines, said that of the P660-billion new borrowings, P185 billion will come from foreign sources and P475 billion will be sourced domestically.

“Government is borrowing much more than what is required to fund the gap in the budget to pay principal amortization on prior years’ debts,” she said in a press statement.

Briones said P405 billion, or two-thirds of these borrowings, will go to principal amortization.

This, she added, belies the claim in the Budget Message that significant progress has been made on strengthening debt management over the past five years.

Senate starts hearings

The Senate finance committee, meanwhile, has called members of the Development Budget Coordination
Council to a meeting on Tuesday afternoon to discuss details of the proposed P1.541- trillion budget for 2010 in advance of House hearings on the money measure submitted by Malacañang to Congress last week.

Sen. Edgardo Angara, who chairs the committee, indicated that senators are determined to pass the 2010 budget “on time” even as the rules require them to wait until the House approves it first; as the law provides that all appropriation bills must emanate from the House of Representatives.

In a statement, Angara noted that the P1.54-trillion budget bill President Arroyo had submitted for Congress approval is 8.06 percent higher than the adjusted budget of P1.426 trillion for 2009.

Impact in succeeding years

Meanwhile, former treasurer Briones said the impact of the heavy borrowings on financing critical social development will not only be felt next year, but in succeeding years as well.

Debt interest payment corners a big chunk of public resources, leaving little room for the government to fund programs necessary to attain the Millennium Development Goals (MDGs) by 2015, she explained.

A professor of public administration at the University of the Philippines, Briones also expressed apprehension over deficit targets for 2010. It is based on a revenue target of P1.336 trillion.

“Assuming revenues will grow by as much as 7.8 percent next year may be too much. It could very well lay the groundwork for either higher deficit or cuts in spending for productive expenditures,” Briones concluded.

Social Watch Philippines (SWP) is part of the international Social Watch Network, which monitors and advocates financing for development and the MDGs. SWP spearheaded the Alternative Budget Initiative, a network of 60 nongovernment organizations advocating for adequate funding for education, agriculture, environment, health and monitoring financing for social development.