There is definitely no budget deadlock between the House and Senate panels and it was only the lack of physical time before the congressional recess which prevented the forging of a reconciled annual General Appropriations Bill for 2008.

This was underscored by Rep. Edcel C. Lagman, Chairman of the Committee on Appropriations and head of the House panel of the Bicameral Conference Committee which is tasked to harmonize the disagreeing provisions of the Senate and House versions.

Lagman scored a ranking leader of the majority coalition of the House who said that the annual budget must be crafted in accordance with the wishes of the Executive.

The Bicol solon said that this proposal is “treason to Congress” which is constitutionally vested with the power over the pubic purse, as well as “an arrogation of the power of the leadership of the Committee on Appropriations.”

Lagman also took issue with Budget Secretary Rolando Andaya, Jr. who claimed that lawmakers “padded the budget” by providing “increases in the Priority Assistance Development Fund (PDAF) from cuts in the debt service.”

Lagman stressed that the PDAF of P6.240 billion proposed by the President for Representatives and Senators in her National Expenditure Program was not augmented by the House and the cuts in debt service (interest payments) consisting of P17.8 billion were all realigned to increase the allocations for basic services and programs like education, health, agriculture, infrastructure, national order and security, and social services and development.

According to Lagman, the cuts in debt service are justified for the following reasons: (1) the peso has strongly and continuously appreciated vis-à-vis the US dollar so much so that the allocation for debt service is now overstated by no less than P12 billion; (2) interest payments for foreign loans which are challenged to be tainted, fraudulent and useless must be suspended pending renegotiation and/or condonation to foreclose the profligate and improvident experience of the Bataan Nuclear Power Plant for which P64.794-B was fully paid even as the loan was deceitful and the project mothballed; and (3) the Executive’s premature allocations of about P5-billion for interest payments for projected program loans still in the pipeline must be expunged from the expenditure program. Precious funds which cannot be utilized must not be immobilized.

The threat of Andaya that if the reduction in debt service will not be restored, the President may veto next year’s budget bill is hollow posturing to force lawmakers to toe the line.

It must be underscored that cuts in debt service were made by Congress from 1993 to 1998 amounting to multi-billion pesos in reductions and the General Appropriations Bills during those years were not vetoed by President Fidel Ramos.

The Chairman of the Committee on Appropriations then was the late Rep. Rolando Andaya, Sr., the father of Budget Secretary Andaya.

The bicameral committee will work during the holiday break and the reconciled appropriations bill will be ratified on 28 January 2008 when Congress resumes its sessions.

The approval of the General Appropriations Act in February 2008 will not adversely affect the operations of the government because the first two months of the new fiscal year would only entail the preparation for the impending budgetary releases while the allocations for personal services are automatically disbursed.