Arroyo Veto on Debt Service Provisions Assailed

Senate Minority Leader Aquilino “Nene” Q. Pimentel,
Jr. (PDP-Laban) today accused President Gloria
Macapagal-Arroyo of breaking anew the constitutional
principle of transparency by blocking the mandatory
public disclosure of repayments for government debts.

Pimentel assailed the President’s veto of a provision
in the 2008 national budget that would require the
Bangko Sentral ng Pilipinas (BSP) and the Department
of Finance (DoF) to submit quarterly reports of actual
and foreign and domestic debt service payments to the
committee on appropriations of the House of
Representatives and the committee on finance of the
Senate.

He also criticized the Chief Executive for vetoing a
special provision in the new budget law that seeks to
prohibit the use of debt servicing funds for loans
that are considered “fraudulent, wasteful or useless.”

Pimentel said there is no rhyme nor reason behind the
President’s veto of the budget provision on the
mandatory reporting of debt service disbursements to
Congress.

“Why would Malacañang hide these transactions from the
public when the Constitution says that the government
must exercise transparency in its actions?” he said.

The minority leader said the need for a full public
disclosure of the government loan transactions becomes
more necessary in the wake of anomalies that have been
uncovered in the $329 million national broadband
project which was funded by a loan from China’s
Export-Import Bank.

“The more they keep these transactions a secret, the
more the people are tempted to think that some hanky
panky is going on,” he said.

Pimentel also explained that the budget provision on
mandatory reporting loan payments was inserted by
Congress to enable it to monitor them in the light of
observations that actual disbursements for debt
service oftentimes exceed funds specifically earmarked
for them.

He charged that the President has gone overboard in
using her veto power by shooting down the special
budget provision banning the use of debt service funds
for loans challenged by civil society groups as
wasteful and useless.

Pimentel said this means that the government will
continue to pay loans for projects which have turned
sour and did not benefit the country at all. He said
lawmakers wanted these projects investigated due to
allegations of anomalies.

“The veto of this special provision overturns the
desire of Congress to provide or augment funds for
essential and productive projects out of savings from
the debt service payments that are disallowed,” he
said.

Had the President not vetoed this provision, this
would have prevented the government from servicing
loans for defective projects such as the procurement
of medical incinerators which failed to meet the
standards of the Clean Air Act and Telepono sa
Barangay, now a white elephant.
-o0o-

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