THE Marcos Jr. administration is set to borrow more from both the local and foreign markets next year to help bankroll the national government’s record-high proposed budget of P5.768 trillion.
Budget Secretary Amenah F. Pangandaman disclosed that the proposed debt borrowing program for 2024 is at P2.46 trillion, some P260 billion higher than this year’s P2.2 trillion programmed borrowing.
Next year’s borrowing program would be higher due to foreign exchange differences, Pangandaman explained.
Pangandaman added that the proposed 2024 borrowing program would still follow a 75:25 mix in favor of the domestic market. This means that 75 percent of the total borrowing program would be sourced domestically and the 25 percent would be foreign borrowings.
At a 75:25 ratio, the national government would borrow about P1.845 trillion from the domestic market and about P615 billion abroad.
The proposed national budget for 2024 is 9.5 percent higher than this year’s P5.268-trillion budget and is also equivalent to 21.8 percent of the country’s GDP, according to the Department of Budget and Management (DBM).
“It is crafted as an indispensable step towards the overarching goal to attain upper-middle-income status while bringing down the deficit to 3 percent of GDP and reducing the poverty rate to 9 percent or single digit by 2028,” Pangandaman said.
The DBM earlier explained that the proposed 2024 national budget will continue prioritizing expenditures that would “sustain” economic growth in line with the Philippine Development Plan 2023-2028 and the administration’s 8-point socioeconomic agenda.
“It shall continue to reflect our commitment to pursue economic and social transformation to address the scarring effects of the pandemic, as well as the impact of inflation, by prioritizing shovel-ready investments in infrastructure projects, investments in human capital development, and sustainable agriculture and food security, among others,” Pangandaman said.
The budget secretary said the DBM received a total of P5.9 trillion in budget proposals for 2024. The proposals, she explained, were “thoroughly evaluated considering several factors such as the agencies’ budget utilization rates in the past years, and the alignment of their programs, activities and projects [PAPs] with the priorities outlined in the Budget Priorities Framework.”
“Due to the limited fiscal space, we optimized the allocation of resources by ensuring that the PAPs that will be budgeted are implementation-ready, and must be delivered and executed on time,” Pangandaman said.
“This entails that the agency proposals considered are clear, comprehensive, and complete in terms of submitted supporting documents such as feasibility studies and annual procurement plans,” Pangandaman added.
Pangandaman said the DBM also considered the agencies’ respective absorptive capacity since a “low budget utilization rate may reflect the agency’s limited capacity to utilize additional funds” in appropriating their 2024 funds.
“Since this proposed National Budget is approved by the President, it already becomes the President’s Budget…Any adjustments in the proposed amounts will result in a zero-sum game where one agency’s gain will be equivalent to another agency’s loss; or one project’s gain is another project’s loss,” Pangandaman said.
Pangandaman said the proposed 2024 national budget will be submitted to Congress a few weeks after the second State of the Nation Address (SONA) of President Marcos Jr. which is scheduled on July 24.
Under the Constitution, the NEP must be submitted to Congress within 30 days after the SONA.
The NEP is the National Government’s spending plan for the next fiscal year. Once approved by Congress, it will be known as the General Appropriations Bill, and once passed into law, the bill will be known as the General Appropriations Act.