President Arroyo can veto proposed 2006 budget
but the economy will suffer, says Drilon

Senate President and Liberal Party head Franklin Drilon today said it was within President Gloria Macapagal Arroyo's prerogative to veto the proposed 2006 national budget but warned that the economy would suffer should government be made to operate under a reenacted 2005 budget for the rest of the year.

In an interview, Drilon defended the decision of the senators to trim the proposed 2006 General Appropriations Act by P26 billion from P1.053 trillion of the House-approved budget. "These cuts were not arbitrarily made. These cuts were made after reviewing the entire expenditure program," Drilon said in an interview.

He stressed, however, that the Senate Bicameral Conference Committee panel was not giving up on efforts to find a compromise on the proposed 2006 budget.

"We are pushing hard for its passage, at this point,' the Senate President said. "That's why we have the Senate contingent on the bicameral conference committee; because the committee is supposed to look for compromises."

Drilon pointed out that the President has the right to veto the budget. "If she vetoes, that's her own prerogative. However, it's unfortunate if she vetoes. Because then, we will be working on the 2005 budget where there will be a lot of discretion involved."

Should the 2005 budget be reenacted, Drilon explained, President Arroyo would again enjoy "a lot of flexibility in fund disbursements because many of the items in the 2005 budget are now free for realignment."

"Either way she wins, but the economy would suffer," Drilon said. "It is not good to operate under a reenacted budget."

"To veto any bill is a prerogative of the President under our system of government," Drilon said. "But it will be unfortunate if she vetoes the 2006 budget as this will force the government to operate again under a reenacted budget until the end of the year. Operating under a reenacted budget repeatedly does not reflect sound management," he added.

Drilon also raised the possibility that President Arroyo's statement that she would veto the proposed 2006 budget could be a ploy to pressure the Senate to restore the cuts it made over the House-approved budget.

"It could just be a ploy to put pressure on the Senate panel which is in the process of holding a bicameral conference to reconcile the two versions of the 2006 budget. The President's statement is meant to pressure the Senate to give in," Drilon said.

Malacañang has proposed a 1.056 trillion-peso appropriation for 2006. Since January, however, the government has been operating on a reenacted budget pending the passage of a new one. The bicameral conference committee is holding marathon sessions to come up with a single version of the budget, but discussions have been deadlocked so far, with lawmakers failing to reconcile their differences over the appropriation. Congress will adjourn on June 9.

The Senate version is P26 billion smaller than the P1.053 trillion of the House-approved budget. It deleted the P5-billion Kilos Asenso and Kalayaang Barangay funds and other appropriations that Malacanang claimed were intended to finance the President's grassroots economic programs. But critics suspect the fund would finance the campaign of the administration's allies in the 2007 election.

In the interview, the President said the Kilos Asenso Program was the counterpart of the national government's programs for agricultural business. She said under the program, funds will be readily available for agricultural businessmen and would help boost the country's agriculture.

But Drilon pointed that the Kilos Asenso fund was not listed under the items of the Department of Agriculture in the proposed budget. "The P5 billion Kilos Asenso is not in the Department of Agriculture contrary to her claim. This amount is found in the lump-sum allocation for local government units," Drilon said.