Wednesday, May 25, 2011

With Budget Deficit, how will they fund the implementation of RH Bill?

Dear insanspinas,

People think that just because a budget appropriation has been made, there is already funding for the bill made into law. Wrong Virginia. The government still has to look for the money. In the case of RH Bill, according to the advocates, costs will be shared by the national and local governments. The question is where are they going to get the money when the budget has already been allocated and there is even a budget deficit. Let's crunch numbers. 

To make my explanation, simpler. let us use my favorite abacus and the family of Juan.

Juan's household expenses amount to 20,000 pesoses. He is earning 15,000 pesoses only. So where does he get the difference of 5,000? From the loan shark.

Juan represents the Philippines. Twenty thousand represents the budget; the 15,000 represents the proceeds from the taxes and other revenues  and the 5,000 represents the budger deficit which is funded by loans from the public in the kind of bonds, loans from the government institutions and other financial institutions. 

Here comes another expense for Juan, Php 2,000. It has to be paid. The missus agreed to allocate a budget for it. So where are they going to get the Php 2,000?

The following are his options:
1. Reduce the budget for other expenses. Perhaps, scrimp on food or reduce the allowances of the children? 
2. Borrow some more money from the loan shark.
3. Look for other sources of income.

Applying these examples to the Philippines with regards implementation of RH bill, the Php 2,000 is the budget appropriation. So where are they going to get this money?

1. Reduce the budget for other expenses. Since RH Bill is covered by the Department of Health, some projects may be affected, like the vaccinations of children  etc. if it chose to cut corners on other social services providing the basic immunization. Reduce personnel perhaps.
But there will be a need for additional manpower to implement the information campaign for the population control bill. (There I said it). 
2. Borrow some more money. Float more bonds. Incur more interest expenses. Whoa.

3. Look for other sources of income. Increase taxes?

If someone from the people who support this RH Bill know where the funding will come from, educate me.


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