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Issues raised by ACT Teachers Rep. Antonio Tinio at the 2016 budget presentation, 10 August 2015

11 August 2015 No Comment

11 August 2015
Reference: ACT Teachers Rep. Antonio L. Tinio (09209220817)

Issues raised by ACT Teachers Rep. Antonio Tinio at the 2016 budget presentation, 10 August 2015

1.       Salary increases for government employees

“The Aquino administration should no longer drag its heels in effecting a new round of salary increases for around 1.4 million employees in government,” said Tinio.  “Going by the mandate in SSL 3, it is already delayed by in granting pay hikes to government workers and giving economic relief especially to low- and middle-level employees.”

Section 1 (e) of the current Salary Standardization Law 3 (SSL 3) mandates a review of the pay structure for government workers “every three (3) years, taking into account…the possible erosion in the purchasing power due to inflation, and other factors.”  This means that Aquino should have come up with a new pay structure and granted pay hikes three years after the implementation of SSL3, or this year.

Tinio noted that, while there is a P50.664 Billion in the 2016 budget under the Miscellaneous Personnel Benefits Fund for “Lump Sum for Compensation Adjustment,” the Aquino administration still has not presented to Congress its concrete proposal for a new compensation structure to replace the SSL 3.

Upon Tinio’s inquiry, Secretary Florencio Abad said that the administration will present its “executive proposal” for a revised Salary Standardization Law but the budget chief failed to say categorically when this will happen.

Considering that the Aquino government should have granted pay hikes this year, Tinio added that any pay hikes should be implemented beginning January 2016 and not in July, as usually done in the past salary adjustments.

2.       Tax relief

Tinio also urged the immediate passage of a bill to lessen income taxes especially for low- and middle-income earners, but opposed strongly a 14% VAT, which the Aquino administration is considering to offset the effects of lower revenues.

“Sadly, we did not hear any resounding support for income tax reform from the finance and budget managers of the Aquino administration, despite the people’s dire need for immediate and substantial income tax relief.  Here we are talking about possible salary increases but in case there will be any, it will not be felt by the people.  Their additional income will only be eaten up by higher taxes anyway.”

Members of the Aquino cabinet before Congress did not give any assurance that income tax reforms will be instituted before Aquino’s term ends.  Said Abad, “I have not been in a formal discussion in the cabinet where the CTRP [comprehensive tax reform program] has been discussed.  In fact, the only opportunity was cancelled.”

Abad was quoted in media reports saying, “I don’t know if President Aquino will approve it because it will be difficult to talk about taxes during an election season.”

3.       Congressional insertions in the 2015 budget, or the amendments introduced by Congress to the budget proposed by the Aquino administration for 2015

Finally, Tinio revealed that a total of P4.826 Billion in the 2015 budget were congressional insertions, citing National Budget Circular 556 Abad issued in 5 January 2015.

An annex to NBC 556 is a “Negative List,” or the items in the 2015 budget which are “For Later Release” (FLR) via Special Allotment Release Order (SARO) “subject to compliance with required documents/clearances.”  Several items amounting to a total of P4.826 Billion are labeled as “Congressional insertion,” “Congressional initiative,” “Initiative from the Senate,” and “House of Representatives’ Initiative,” mostly with the remark “No details submitted.”

Most of the congressional insertions are infrastructure projects and programs having individuals as beneficiaries, similar to the “hard” and “soft” projects funded by PDAF or congressional pork.  A total of P1.651 Billion in DSWD are congressional insertions for “Protective services for individuals and families in especially difficult circumstances,” “Social Pension for Indigent Citizens,” and “Comprehensive Project for Street Children, Street Families, and IPs.”

When pressed, Abad said that the documents required for release of the funds covered by the insertions are documents such as lists of beneficiaries.

“These insertions smell strongly of pork given that these funds are lump sums at the time when the 2015 budget was passed and these programs and projects are similar to the hard and soft projects under the unconstitutional PDAF.  DSWD’s doleout for ‘individuals and families in especially difficult circumstances’ in fact is one of the programs to which the PDAF was realigned back in 2014, after the Supreme Court’s decision,” revealed Tinio.

“We now have another proof, as admitted by the DBM itself through its circular, that the 2015 budget is far from the ‘pork-less’, as touted by the Aquino administration.  We will continue to criticize the phenomenon of congressional insertions, and the billions of discretionary lump sums as we deliberate the 2016 national budget,” ended Tinio. ###

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