GOV’T REFORMS, UPDATED PLAN TO ENSURE EFFECTIVE PUBLIC SPENDING—NEDA

MEXICO CITY—The National Economic and Development Authority (NEDA) said that the Philippine government’s plan of increasing the share of social and infrastructure spending will be coupled with fiscal and governance reforms to ensure the effectiveness of public expenditures.

Speaking during a session of the First High-Level Meeting of the Global Partnership for Effective Development Cooperation on April 15, 2014, Economic Planning Secretary Arsenio M. Balisacan said that this strategy is in line with the Philippine Development Plan (PDP) 2011-2016 Midterm Update.

“The Philippine government’s spending on infrastructure and other capital outlays has significantly increased in recent years. These are channeled specifically to projects that benefit the poor, such as construction and rehabilitation of roads and bridges, enhancement of tourism access, and irrigation to support the agriculture sector,” said Balisacan during the event’s session on Linking Domestic Resource Mobilization to Public Expenditure Needs.

He added that higher infrastructure spending is expected to reach 5 percent of gross domestic product (GDP) by 2016 as outlined in the Updated PDP.

“The Philippine government has embarked on a series of reforms in the fiscal sector and in governance to mobilize domestic resources.  These will help meet the country’s spending priorities in social development, infrastructure, and especially developing resilience against natural shocks,” said Balisacan, who is also NEDA Director-General.

The Cabinet official said recent reforms of the Philippine government include policies and programs that aim to widen the tax base, prosecute and jail tax evaders, raise taxes on “sin” products, and eliminate corruption.

“These resulted in a wider fiscal space that provided enough flexibility to sustain the momentum of increased spending and improved budget allocation. In turn, these allowed the expansion and improvement of investments in health, education, social protection, and infrastructure, which are known to be binding constraints to poverty reduction and inclusive development,” said Balisacan.

During the session that had a panel of distinguished representatives from the U.S. Agency for International Development (USAID), Kingdom of Norway, Africa and other international civil society organizations, Balisacan highlighted critical factors that successfully link resource mobilization with public expenditure needs in the Philippines.

“First, there is a need for a credible government that ‘puts its money where its mouth is.’ Next, a plan should provide a clear set of targets that are relevant, meaningful, and can be monitored to measure and report the government’s performance and accountability.  And we addressed this through the Updated PDP.  Finally, a country needs a development budget that has predictable and sufficient resources to support the implementation of the Plan,” Balisacan concluded.

The high-level meeting brought together over 1,500 participants, including heads of states, ministers, parliamentarians and leaders from international organizations, businesses, civil society and foundations.

United Nations Secretary-General Ban Ki-moon led the high-level meeting, which aimed at building on the commitments made in 2011 during the Fourth High-level Forum on Aid Effectiveness in Busan, South Korea.