DOF Sec. Dominguez explains Duterte's 'wala tayong pera' remark

The Department of Finance (DOF) on Wednesday said the Philippines currently has the cash, but there are budgetary constraints preventing the additional spending on measures aimed against the coronavirus disease.

In a virtual briefing, Finance Secretary Carlos Dominguez III was asked to respond to remarks made by President Rodrigo Duterte that the Philippines no longer has any money.

"In government kasi, in government, you have cash and you have budget. Even though we have the cash, we can only spend what the legislator allows us to spend so we have a budget," he said during the Kapihan sa Manila Bay virtual forum.

Duterte in January signed into law the P4.1-trillion General Appropriations Act (GAA) for 2020, with education having the lion's share of P654.6 billion.

"Wala tayong pera ngayon," Duterte said last Monday, as he said he would look for funds to acquire radios for far-flung areas in line with the shift to blended learning.

Dominguez clarified on Wednesday, however, that the country has the cash but spending is limited.

"Our budget for this year is P4.1 trillion, but we certainly have the cash. Unfortunately, we don't have the budget space so we are making do with what we can," he said.

"The other consideration also is that like any household, we cannot spend more than what we earn and that is called a deficit. That is what you spend more than taxes," explained Dominguez.

At present, the government said it plans to cap the deficit at as much as 9% of the gross domestic product (GDP) from about 3.5% in 2019.

"We expect this deficit this year to be already 8.4%. We can go up to 9%, but beyond that is already very dangerous for us just like any household, so we have to watch that," said Dominguez.

Dominguez said the Philippines has borrowed P1.2 trillion and $4.8 billion so far to boost the government's war chest against the coronavirus disease.

"Even though we have the cash, we also have to reserve the cash for a second round and we don't know when the COVID virus is going to be defeated. Many countries have already had a second wave," he said.

"We might have a second wave. I hope we don't, but we have to prepare for that and we have to prepare for the long run. So like any family, you also have to make sure that you have enough for the future," added Dominguez.

Latest data available from the Bureau of Treasury (BTr) indicate that the government incurred a fiscal deficit of P202.1 billion in May. This is a reversal of the P2.6-billion surplus the same month last year.

Year-to-date, the cumulative deficit widened to P562.2 billion from the P809 million deficit recorded in the comparative period in 2019. —KG, GMA News