LIFE MATTERS: Public Finance 101


By Dr. Dennis Acop

With all the news that seems to depict corruption as almost normal business, as usual, let me just be clear that corruption is the worst enemy of public service and the number one threat to effective governance. This brief article argues that corruption undermines the public administration process and ultimately prevents public programs and projects from being delivered. Basically due to the fact that more financial resources are wasted as they get siphoned off to line the pockets of greedy and hypocritical government officials.

Governments run in order to serve the general public. For them to run, financial resources are needed. These basically come in the form of taxes collected from the incomes of people. The more taxes governments collect, the more resources they have at their disposal for public programs and projects benefiting the taxpayers. In the Philippines for instance, income earners pay as much as one-third of their incomes to the government.

It is a pity therefore that Philippine public corruption accounts for as much as half of all public monies circulating in the public administration system according to studies. This basically means that programs are budgeted 100 percent but only fifty percent delivered. The other fifty divided among the Judases in government. It is not surprising therefore to see projects lying around which are only partially completed. Not even more surprising to see public officials with subdued salaries owning houses in gated communities and brand-new paid-for vehicles.

Who suffers the most from these indiscretions? Naturally, the most vulnerable of society suffers the most from public projects that are half-baked or worse are ghost projects. These are the poor who number millions in the Philippines. They are easy to find. They live in the slums and run-down ghettoes of the city. They roam around homeless eating from garbages and sleeping with their children on dimly lit sidewalks. They are the beggars knocking on car Windows. They are the uneducated who cannot find decent jobs. The unschooled who cannot know the difference between drug addiction and a decent, healthy lifestyle. Them who are so dirt poor they turn to crime as last resort or sell their own children for a pot of mesh. The sick poor in charity wards who survive only by the free medicines and services rendered unto them by a public healthcare system subsidized by the government. The uneducated poor whose only chance at a better life is through subsidized quality education. The poor old people without pension whose only chance for a dignified end is through subsidized care and end of life assistance from public welfare systems. The marginalized whose only chance at a just cause is through preferential treatment towards egalitarianism from a humane public system. While the rest of us look away with indifference and self-concern. Even disdain as these lower mortals deserve their lot.

How are things supposed to work? The three branches of government are supposed to see a system that would work in terms of having the power and resources to alleviate the suffering of the poor and marginalized of society. In Congress lies the Power of the Purse. Congress comprises many individuals as these represent the various concerns of the different localities across the country. They are supposed to bring to the table the foremost concerns of their respective publics especially those from the poor and marginalized. Collectively, Congress is supposed to rationalize all concerns with prioritization in mind. As financial resources are huge but still limited given the multifarious needs of various communities. Congress is supposed to allocate financial resources for the public programs and projects deemed most urgent. The determined budgets processed by Congress go up for approval before the Chief Executive, the second branch of government. It is the President who will execute the Annual Budgetary Law containing all public projects up for delivery deliberated by Congress. If there are any inconsistencies between Congress and the Presidency, the Judiciary steps in. This third branch balances the power of government between the Legislature and the Presidency. In fact, all three branches of government balance one another out. Therefore, there should be no room for abuse by a single branch.

The Purse or the Annual Budgetary Law is the real power in governance. It is that which makes things happen in government. No public project gets done without a deliberated budget. And the Annual Budget is a Law. It is a crime to not execute it according to its content and form. There should be no room for any Pork Barrel as Pork Barrel essentially goes against the spirit and letter of the Annual Budgetary Law. Pork Barrel sets aside the Budget Law creating its own budget that will line up the pockets of corrupt officials perpetuating the local system of graft and corruption. The Annual Budget is in Trillions. It is a magnet for any greedy official. But it is lost opportunity and lost conscience for the common good.


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