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Government funding to fight Covid-19 deemed adequate

government funding to fight covid 19 deemed adequate 816x445 - Government funding to fight Covid-19 deemed adequate

THE Treasury said the government has sufficient cash to support agencies seeking to contain the outbreak of coronavirus (Covid-19) cases.

In a report to its parent agency the Department of Finance (DoF), National Treasurer Rosalia V. de Leon said “cashflow is more than adequate” to support agencies responding to the pandemic.

Asked for details, Ms. De Leon said the government raised more than P300 billion in retail Treasury bonds (RTBs) early last month, while the Bureau of the Treasury (BTr) has been making full awards during recent auctions of government securities.

“(Also), the domestic market is liquid (due to investors’) flight to safe havens especially government securities. We are the (only) game in town,” she said in a mobile phone message.

Budget Secretary Wendel E. Avisado said there is “nothing to worry” about in terms of funding.

“Our crisis management committee has met and set in place the required system to insure that DBM operates and attends to all funding requirements of the government at this time of national health emergency,” Mr. Avisado said in a mobile phone message.

Budget Undersecretary Laura B. Pascua said the Department of Health (DoH) also has P600 million in its quick response fund that it can use for responding to the pandemic, in addition to its regular budget. This can also be replenished from the P16 billion worth of funds from the National Disaster Risk Reduction and Management Council (NDRRMC).

On Tuesday, the Economic Development Cluster approved P2.92 billion in additional funding for the DoH, specifically for “additional testing, augmentation of contact tracing and surveillance and additional personnel protective equipment for health workers at the national and local levels.”

The government has estimated that it could lose P91 billion worth of revenue if disruptions caused by the pandemic linger until June. The government hopes to collect P3.49 trillion this year to fund its P4.1-trillion spending plan, with the remainder to be sourced from borrowing.

Mr. Dominguez has said the government needs to expand its borrowing program to plug any potential funding gaps, with the deficit estimated to rise to as much as 3.6% of gross domestic product (GDP) this year, well above projections. A deficit of 3% of GDP is deemed in many economies to be the ceiling for prudent spending, with the government previously expecting to spend the equivalent of 3.2% to ramp up its infrastructure program.

Ms. De Leon said the BTr has set up remote access for critical operations including its weekly auctions, payments and investments as its main office will shut down Friday to be sanitized.

“Everything is in place for remote access for critical operations like auction, payments and investments. Have assigned rotating skeletal force in case of prolonged lockdown. Have coordinated with PSALM (Power Sector Assets and Liabilities Management Corporation) for a temporary war room and another one in our Pampanga regional office is being readied. Cashflow is more than adequate,” Ms. De Leon said in a text message to the DoF, a copy of which was sent to reporters.

Meanwhile, various government offices have suspended work and closed down offices Thursday to disinfect their premises to help contain the outbreak from spreading further.

This includes offices of the Department of Budget and Management, Department of Finance and the National Economic and Development Authority, among others. — Beatrice M. Laforga

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