Press Release
December 19, 2017

Legarda: President Duterte Enacts P3.767-Trillion 2018 National Budget

Senator Loren Legarda today said that President Rodrigo Roa Duterte has signed into law the 2018 General Appropriations Act (GAA) amounting to Php3.767 Trillion-the highest allocation by any administration.

Legarda, Chair of the Senate Committee on Finance, reiterated that the 2018 GAA is a makatao or pro-people budget that places heavy importance on providing for the actual needs of the Filipinos, such as education, healthcare, livelihood, shelter, peace and order, and other support and services to the public.

"The GAA is the law that declares how much our government is able to extend its support for the Filipino people. For next year, our GAA is worth Php3.767 Trillion, the biggest budget the Philippine government ever had, which will also be the biggest amount our government would invest on its people," said Legarda.

"It is truly fulfilling to culminate this process with the President signing the very product of months long of intense budget deliberations at the Senate and the bicameral conferences-all for a budget that indeed reforms and transforms the lives of our Filipino people. Moreover, the President also signed the Tax Reform for Acceleration and Inclusion (TRAIN) Law, a very important measure that would allow our people to take home more of what they earn while also generating needed revenues for the government," she said.

Legarda added, "No less than credit rating agency Fitch Ratings, which upgraded the Philippines' long-term credit rating from BBB- to BBB, said that it expects the country's fiscal profile to improve due to the TRAIN Law. I am optimistic that the 2018 GAA and TRAIN Law will both usher in more stable growth for the country, growth that is sustainable, resilient and inclusive."

The Senator also noted that the Asian Development Bank (ADB) has upgraded its 2017 and 2018 economic growth forecasts for the Philippines.

The ADB upgraded its 2017 GDP forecast for the Philippines to 6.7% from the previous 6.5%, while its 2018 GDP forecast increased from 6.7% to 6.8%.

The ADB in its report "assumes that growth in the government's infrastructure program will accelerate, supported by improvements in budget execution, with more large investment projects underway."

The Senator explained that in the 2018 GAA, social services[1] remain to have the biggest share of the budget pie with 38.7%, followed by economic services[2] with 30.5%, then general public services[3] with 16.4%, then debt burden with 9.8%, and defense allocation with 4.6%.

Legarda said that the top ten agencies with the highest budgetary allocations are as follows: (1) Education agencies inclusive of the Department of Education (DepEd), the Commission on Higher Education (CHED) and state universities and colleges (SUCs), with Php664.8 Billion; (2) the Department of Public Works and Highways (DPWH) Php637.8 Billion; (3) the Department of Health (DOH), including budgetary support for government corporations (BSGC)[4], with Php171.09 Billion; (4) the Department of the Interior and Local Government (DILG) with Php170.7 Billion; (5) the Department of National Defense (DND) with Php149.69 Billion; (6) the Department of Social Welfare and Development (DSWD) with Php141.8 Billion; (7) the Department of Agriculture (DA) and its attached agencies with Php103.07 Billion; (8) the Department of Transportation (DOTr) and BSGC with Php70.9 Billion; (9) the Department of Finance (DOF) and BSGC with Php48.07 Billion; and (10) the Department of Environment and Natural Resources (DENR) with Php24.9 Billion.

The Senator said that education is a top priority of the 2018 GAA. The most noteworthy increase is the Php40 Billion funding for free college education in all SUCs, local universities and colleges (LUCs), and state-run technical-vocational institutions, for the implementation of the Universal Access to Quality Tertiary Education Act.

An additional Php10 Million for capital outlay of each SUC was approved in order to purchase equipment and improve facilities within their campuses. Moreover, Php327 Million under the Department of Information and Communications Technology (DICT) was allocated to install Wi-Fi in SUCs to aid students in their school requirements. Another Php250 Million funding under CHED was also allocated for free tuition for medical students enrolled in SUCs.

Furthermore, under the budget of DepEd, chalk or cash allowance of teachers-intended for the purchase of classroom supplies like chalk, markers, paper, erasers and other materials-will increase from Php2,500 to Php3,500 per teacher.

As regards the health sector, the 2018 GAA will continue to fund the Universal Healthcare Program under Philippine Health Insurance Corporation (PhilHealth) so that all Filipinos can access healthcare services in all government hospitals. There is also Php3.5 Billion for PhilHealth Plus to provide for the health insurance of government employees under the executive department.

The DOH budget was also increased to provide additional funding for Medical Assistance Program for indigent patients, additional medicine for cancer patients, and Health Facilities Enhancement Program, among others. A special provision was also included to prohibit the purchase of Dengue vaccines.

To improve social services, aside from maintaining the Php89 Billion budget for the Pantawid Pamilyang Pilipino Program (4Ps), the DSWD's flagship project, there is also an allocation in the amount of Php2.080 Billion for the rehabilitation of social welfare and activity centers and Bahay Pagasa juvenile detention centers.

To support the growth of micro, small and medium enterprises (MSMEs), there is additional funding worth Php800 Million in the Department of Trade and Industry's (DTI) Shared Service Facilities (SSF), which intends to increase the productivity of MSMEs by giving them access to efficient technologies, skills, knowledge, and systems.

For the agriculture sector, farmers will continue to receive government support through the subsidy of irrigation service fees being paid by farmers to the National Irrigation Administration (NIA). The DA also has Php2.669 Billion for the construction, restoration or improvement of small-scale irrigation projects and Php4.281 Billion for the construction of facilities and procurement of agricultural machineries and equipment.

To ensure quick recovery, reconstruction, and rehabilitation of war-torn Marawi City, Php10 Billion was allocated for such purpose under the National Disaster Risk Reduction and Management (NDRRM) Fund.

Unpaid pension that the government owes to surviving spouses of World War II veterans will now be fully paid under the 2018 budget with the allocation of Php1.647 Billion for the payment of total administrative disability (TAD) arrears.

In support of strengthening the military and police's role in maintaining national security and peace and order, the 2018 GAA provides improved benefits for uniformed personnel. It allocated Php62.8 Billion for the increase of base pay of military and uniformed personnel.

Since the Philippine Drug Enforcement Agency (PDEA) will now lead the government's anti-illegal drugs campaign, additional Php1.2 Billion was allocated to the agency to help expand its operations and construction of regional/provincial offices.

Meanwhile, the Php900 Million and Php500 Million under the DILG budget for Oplan Double Barrel and MASA MASID, respectively, were realigned. Php1.35 Billion was transferred to the Philippine National Police (PNP) and Armed Forces of the Philippines (AFP) Housing Program; while the Php50 Million was earmarked as additional budget for acquisition of body cameras of police officers. Total budget for the acquisition of body cameras of police officers is Php334 Million.

Under the DILG budget, Php100 Million was earmarked for closed circuit television (CCTV), Php451 Million for the purchase of two helicopters, and Php70 Million additional funding under the Internal Affairs Service to ensure that they have sufficient funds to conduct their investigation on erring policemen.

Additional Php300 Million was also allocated under the Bureau of Corrections for additional prison facilities.

The budget of the Technical Education and Skills Development Authority (TESDA) was also increased for its quality technical education and skills development program.

Under the budget of the DOF, Php1.493 Billion was allocated for the purchase of x-ray machines and a special provision was introduced to expand custom inspection to include bulk inspection and containerized cargo.

Meanwhile, the Department of Foreign Affairs (DFA) budget will receive an increase of Php783 Million for additional funding of existing consular offices and embassies, opening of new consulates, cultural diplomacy programs, training programs, and hazard pay of DFA employees in hardship posts, among others.

Legarda said that the 2018 national budget includes funding in various agencies of government to institutionalize disaster risk reduction and climate adaptation measures, as well as special and general provisions that will ensure ecological integrity, clean and healthy environment, risk-sensitive investments, and disaster preparedness.

Moreover, the Quick Response Fund (QRF) of various agencies originally lodged under the NDRRM Fund was transferred to the implementing agencies to ensure quick access and utilization when the need arises.

Legarda also ensured that art and culture and heritage promotion will continue to be supported in the national budget, primarily through the funding for the activities of the National Commission for Culture and the Arts (NCCA) and other cultural agencies.

"The passage of our national budget every year comes with the hope of achieving real lasting growth for Filipinos, especially the poor and the most vulnerable. This is the makatao budget I have proudly championed in the Senate that will further accord the respect and dignity befitting all Filipinos. I share the same optimism and belief in our government to spur growth and sustain progress for our people at a level that they rightfully deserve," Legarda concluded.

[1] Social services include education, health, welfare and employment, housing, and community development.
[2] Economic services include agriculture, infrastructure, tourism, power, and energy, among others.
[3] General public services include public order and safety, funds for judiciary, and subsidy to LGUs.
[4] Lung Center of the Philippines, National Kidney Transplant Institute, Philippine Children's Medical Center, Philippine Heart Center, Philippine Health Insurance Corporation, and Philippine Institute and Alternative Health Care

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