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Sustained support for social services and infrastructure development and the country’s commitment to the Millennium Development Goals (MDGs) are prioritized in the 2008 national budget as contained in the bicameral conference committee report that is slated for ratification by the House of Representatives and the Senate today, 28 January 2008.

This was underscored by Rep. Edcel C. Lagman, Chairman of the House Committee on Appropriations, as he and Sen. Juan Ponce Enrile, Chairman of the Senate Committee on Finance, signed the joint conference committee report on House Bill No. 2454, the General Appropriations Bill (GAB) for 2008 which virtually maintained the expenditure ceiling of P1.227 trillion proposed by President Gloria Macapagal Arroyo in the National Expenditure Program (NEP).

For the first time in almost a decade, the debt service allocation for interest payments was cut, paving the way for augmenting the appropriations for (1) health, (2) education, (3) agriculture, (4) social welfare, (5) infrastructure, (6) local governance and development, (7) justice and the judiciary, (8) labor and employment, (9) energization, (10) environment, and (11) public safety and security, among others.

Lagman said that “Congress in the reconciled appropriations bill gave more flesh to the President’s budget message of ‘Sustaining the Momentum of Growth’ by increasing the government’s budget for basic services and infrastructure development to heed the demands of both the masses and the investors.”

“The increases in education, health, agriculture, social welfare and development, energization and environmental protection address the government’s commitment of attaining the MDGs principally on eradicating extreme hunger and poverty, achieving universal primary education, promoting gender equality, reducing infant mortality, improving maternal health, combating HIV-AIDS and tuberculosis, and ensuring environmental sustainability,” Lagman added.

The reduction in interest payments for foreign loans totaled P25.9 billion and consisted of the following:


  1. P15.9 billion corresponding to savings as a result of the appreciation of the peso with the exchange rate recomputed at P41.00 to a dollar from a high assumption of 48:1 in the NEP or a P7.00 differential. (Savings of P2.272 billion is generated for every peso appreciation);
  2. P5 billion in suspension of interest payments for loans which are challenged as fraudulent, tainted and/or useless pending the Executive’s renegotiation of the loans or their eventual condonation; and
  3. P5 billion in premature allocations for interest payments for program loans and bond issuances still in the pipeline.


In addition to the debt service cut, proposed appropriations for slow-moving projects, excess allocations and other miscellaneous allotments totaling P12.638 billion were likewise slashed.

The total cuts amounting to P38.5 billion were realigned to the budgets of the following agencies and programs, among others, to increase their respective appropriations as originally proposed in the NEP:


  1. Basic and higher education was increased by P4.829 billion for a total new appropriations of P158.602 billion;
  2. Health was increased by P5.790 billion for a total new appropriations of P25.847 billion;
  3. Agriculture was increased by P1.872 billion for a total new appropriations of P29.161 billion;
  4. Infrastructure was increased by P12.982 billion for a total new appropriations of P94.729 billion ;
  5. Justice and the judiciary was increased by P1.236 billion for a total combined new appropriations of P16.570 billion;
  6. Social welfare and development was increased by P.165 billion for a total new appropriations of P4.848 billion;
  7. Local governance and development was increased by P3.500 billion for a total new appropriations of P16.253 billion;
  8. Public safety and security was increased by P.859 billion for a total new appropriations of P53.242 billion;
  9. Labor and employment was increased by P.236 billion for a total new appropriations of P6.272 billion;
  10. Energization was increased by P.600 billion for a total new appropriations of P.922 billion;
  11. Environmental protection was increased by P.184 billion for a total new appropriations of P8.118 billion; and
  12. Sports development was increased by P.059 billion for a total new appropriations of P.360 billion;


Aside from infrastructure development, the health, education and agriculture sectors were the biggest beneficiaries of the bicameral augmentation with respective increases of P5.790 billion, P4.829 billion and P1.872 billion.

According to Lagman, sports development got the highest percentage increase (19.6% or P59 million) to propel Filipino athletes in their quest for gold in the Beijing Olympics in August 2008.