IDEAS home Printed from https://ideas.repec.org/p/phd/dpaper/dp_2011-20.html
   My bibliography  Save this paper

Analysis of the President`s Budget for 2012

Author

Listed:
  • Manasan, Rosario G.

Abstract

The 2011 and 2012 fiscal program appears to score high in terms of contributing to the speed of fiscal consolidation despite limited gains in revenue generation. This came about largely because of fairly serious underspending during the first nine months of 2011. The slow utilization of spending authority has been attributed to the diligence that many government agencies have directed on the contracting/procurement process given the new administration`s focus on anticorruption and good governance. However, it cannot be denied that such "underspending" necessarily contributed to the lower-than-target rate of economic growth. The proposed expenditure program for 2012 is PHP 171 billion (or 10.4%) higher than the PHP 1.6 trillion expenditure program for 2011. Close to two-thirds of the increment in the proposed expenditure program net of debt service is captured by the social service sectors and the economic service sectors combined. In particular, 33.2% of the increment in the expenditure program net of debt service in 2012 relative to the 2011 program is allocated for all the social service sectors combined while 31.0% of the increment is alloted for all the economic service sectors as a group. In a sense, the bias toward the social service sectors that was very much evident in the national government expenditure program in 2011 has been replaced by a more balanced distribution between the social services sectors and the economic services sectors. Despite the higher allocation that is provided the economic services sectors (particularly, infrastructure) under the 2012 National Expenditure Program, the level of national government spending on the infrastructure sector compares unfavorably with the amount of resources needed to achieve high, sustained, and inclusive growth. On the other hand, 2012 spending levels on education, health, and social welfare services will continue to lag behind those of other countries in the region. Moreover, programmed national government spending on basic education is estimated to fall short of the amount required to achieve the MDG target for education. Given the evidence that significant levels of unmet needs are not being addressed, this study echoes previous calls for government to recognize that national government revenues has to expand at a faster rate than has been demonstrated by the collection agencies so far. Although there is evidence that some gains have been made in BIR tax effort since the Aquino II administration came into power, the improvement in tax effort to date pales in comparison with the amount needed to achieve sustained and inclusive growth with fiscal consolidation. Furthermore a comparison of actual revenue collection in January—September 2011 with that in January—June 2011 also suggests that the pace of improvements (or lack of it) in tax administration may have faltered in the third quarter of the year. It is, thus, critical that efforts toward improving collection efficiency be renewed and re-invigorated in the fourth quarter.

Suggested Citation

  • Manasan, Rosario G., 2011. "Analysis of the President`s Budget for 2012," Discussion Papers DP 2011-20, Philippine Institute for Development Studies.
  • Handle: RePEc:phd:dpaper:dp_2011-20
    as

    Download full text from publisher

    File URL: https://www.pids.gov.ph/publication/discussion-papers/analysis-of-the-president-s-budget-for-2012
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Blanca Sanchez‐Robles, 1998. "Infrastructure Investment And Growth: Some Empirical Evidence," Contemporary Economic Policy, Western Economic Association International, vol. 16(1), pages 98-108, January.
    2. Manasan, Rosario G., 2010. "Financing the MDGs and Inclusive Growth in the Time of Fiscal Consolidation," Discussion Papers DP 2010-34, Philippine Institute for Development Studies.
    3. John G. Fernald, 1999. "Roads to Prosperity? Assessing the Link between Public Capital and Productivity," American Economic Review, American Economic Association, vol. 89(3), pages 619-638, June.
    4. Demetriades, Panicos O & Mamuneas, Theofanis P, 2000. "Intertemporal Output and Employment Effects of Public Infrastructure Capital: Evidence from 12 OECD Economics," Economic Journal, Royal Economic Society, vol. 110(465), pages 687-712, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Manasan, Rosario G., 2013. "Analysis of the President`s Budget for 2013," Discussion Papers DP 2013-31, Philippine Institute for Development Studies.
    2. Rosario G. Manasan, 2013. "Analysis of the President's Budget for 2013," Working Papers id:5391, eSocialSciences.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ward Romp & Jakob De Haan, 2007. "Public Capital and Economic Growth: A Critical Survey," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 8(S1), pages 6-52, April.
    2. Fedderke, J.W. & Bogetic, Z., 2009. "Infrastructure and Growth in South Africa: Direct and Indirect Productivity Impacts of 19 Infrastructure Measures," World Development, Elsevier, vol. 37(9), pages 1522-1539, September.
    3. Bajar, Sumedha. & Rajeev, Meenakshi., 2015. "The impact of infrastructure provisioning on inequality : evidence from India," ILO Working Papers 994882713402676, International Labour Organization.
    4. Stephane Straub, 2008. "Infrastructure and Growth in Developing Countries: Recent Advances and Research Challenges," Edinburgh School of Economics Discussion Paper Series 179, Edinburgh School of Economics, University of Edinburgh.
    5. Ibrahim B. Kamara, 2007. "The Direct Productivity Impact of Infrastructure Investment: Dynamic Panel Data Evidence From Sub Saharan Africa," Working Papers 048, Economic Research Southern Africa.
    6. Federici, Andrea, 2018. "Il rapporto tra capitale pubblico e altre variabili macroeconomiche: analisi della letteratura [The relationship between public capital and other macroeconomic variable: a literature review]," MPRA Paper 88515, University Library of Munich, Germany.
    7. Sinem Kilic Celik & M. Ayhan Kose & Franziska Ohnsorge, 2023. "Potential Growth Prospects: Risks, Rewards and Policies," CAMA Working Papers 2023-19, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    8. Francisco Rodríguez, 2006. "Have Collapses in Infrastructure Spending Led to Cross-Country Divergence in per Capita GDP?," Wesleyan Economics Working Papers 2006-013, Wesleyan University, Department of Economics.
    9. repec:cuf:journl:y:2014:v:15:i:2:calderon:serven is not listed on IDEAS
    10. Francisco, Kris A., 2017. "The Impacts of Roll-On/Roll-Off Transport System in the Philippines," Discussion Papers DP 2017-22, Philippine Institute for Development Studies.
    11. Agénor, Pierre-Richard & Bayraktar, Nihal & El Aynaoui, Karim, 2008. "Roads out of poverty? Assessing the links between aid, public investment, growth, and poverty reduction," Journal of Development Economics, Elsevier, vol. 86(2), pages 277-295, June.
    12. Silvia Bertarelli, 2006. "Public capital and growth," Politica economica, Società editrice il Mulino, issue 3, pages 361-398.
    13. Melvin Ayogu, 0. "Infrastructure and Economic Development in Africa: A Review-super- †," Journal of African Economies, Centre for the Study of African Economies, vol. 16(suppl_1), pages -126.
    14. Mathias Hoffmann, 2003. "Cross-country evidence on the link between the level of infrastructure and capital inflows," Applied Economics, Taylor & Francis Journals, vol. 35(5), pages 515-526.
    15. Hurlin, Christophe, 2006. "Network effects of the productivity of infrastructure in developing countries," Policy Research Working Paper Series 3808, The World Bank.
    16. Mehmet Aldonat Beyzatlar & Mehmet Yeşim Kuştepeli, 2011. "Infrastructure, Economic Growth and Population Density in Turkey," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 4(3), pages 39-57, December.
    17. Atif Ansar & Bent Flyvbjerg & Alexander Budzier & Daniel Lunn, 2016. "Does infrastructure investment lead to economic growth or economic fragility? Evidence from China," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 32(3), pages 360-390.
    18. Rioja, Felix K., 2003. "Filling potholes: macroeconomic effects of maintenance versus new investments in public infrastructure," Journal of Public Economics, Elsevier, vol. 87(9-10), pages 2281-2304, September.
    19. Youze Lang & Qiuyi Yang, 2019. "Does Public Infrastructure Breed Consumption Downgrade and Overcapacity in China? A DSGE Approach on Macroeconomic Effects," Sustainability, MDPI, vol. 11(3), pages 1-23, February.
    20. Calderon, Cesar & Serven, Luis, 2008. "Infrastructure and economic development in Sub-Saharan Africa," Policy Research Working Paper Series 4712, The World Bank.
    21. Ghosh, Prabir Kumar & Dinda, Soumyananda, 2019. "Revisited the Relationship Between Economic Growth and Transport Infrastructure in India: An Empirical Study," MPRA Paper 116876, University Library of Munich, Germany, revised Feb 2021.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:phd:dpaper:dp_2011-20. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Aniceto Orbeta (email available below). General contact details of provider: https://edirc.repec.org/data/pidgvph.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.