Press Release
January 31, 2008

While saying intention to provide rebates is laudable, Villar says Congress nod needed for P75-B stimulus plan

Senate President Manny Villar today said the constitutional rule stating that any spending of tax peso must be through an appropriation of Congress should be followed in allocating funds for the P75-billion economic relief plan.

"I think the President should first go to Congress because she cannot just issue a check for P75 billion. The Constitution says that money can only leave the treasury if it's appropriated by Congress, "he said.

Villar noted that the stimulus package would provide P51 billion in additional infrastructure and social services spending, P8 billion in rebates to households consuming less than 200 kilowatt-hours of electricity a month, and P16 billion in additional personal income tax deductions to benefit the middle-income households earning less than P500,000 per annum.

"A feature of this new measure, which provides rebates for small-time energy consumers, is laudable especially at this time when we have escalating prices of oil. Its intention to increase spending on agriculture, infrastructure, housing, education and to increase Philhealth membership is right but without an oversight bureau, it could be prone to budget diversions," Villar said.

He also added that clear provisions and procedures must be implemented so as to avoid any room for corruption.

Villar said if the P75-billion economic stimulus plan was inspired by the $150 billion anti-recession package the US government is putting together, "then it must be pointed out that the White House is not doing it alone but it is asking the US Congress for money."

"Malacañang should send a supplemental budget to the House and to the Senate," Villar said.

The same thing was done in 2006, Villar recalled, when a budget deadlock that year led to the reenactment of the previous year's budget, prompting the Palace to ask for a P50- billion supplemental budget to address funding gaps and new expenses.

"Remember we gave it to them. It proved that Senate and Malacañang can share common ground, when it affects the interest of the people. Ang sa akin lang sundin ang Saligang Batas," Villar said.

The Nacionalista Party president said "congressional scrutiny of the proposal is needed so we would know if the package would require taxes, if it would lead to a deficit, how it will be funded, and if the targeted recipients are indeed the worthy ones."

"The government has promised a balanced budget this year. Does this mean that it is now abandoning its position and if yes, to what point will a deficit be tolerated?" Villar said.

"Gusto nating makuha ang detalye. Malay mo baka mas malaki ang pwede nating ibigay kung may pondong makikita at kung meron naman talagang pangangailangan," he added.

Villar noted that the P51 billion would need "appropriations cover," while the tax breaks, "if statutory, must be done through legislation."

With regard to providing rebates to small-time energy consumers, Villar believes that government can provide subsidies to households availing the lifeline rates. He noted that presently, households consuming 50kwh or less are given a discount of P.11/kwh. This subsidy, however, comes from other households.

"If it should be increased, it may be more favorable if the government shoulders this burden. Another option is to expand the coverage of the lifeline rates, say, from households consuming 50kwh to 100kwh," Villar said.

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