IBON Features | COMMENTARY | By Sonny Africa | These funds need to be removed from the discretion of the chief executive – whose powers over budgets must also be reduced – and subjected to greater public oversight.
(Second of Two Parts)
Pork barrel abuses
The PDAF accounts for just 2.2% of presidential pork barrel. At any rate, the history of PDAF provides a useful case study of how political elites abuse the national budget for self-interested purposes. Philippine legislators were able to identify projects as early as 1922, during American colonial rule, through a Public Works Act. This continued in the 1950s with lawmakers identifying ‘community projects’, ‘miscellaneous community projects’ and ‘nationwide selected projects’.
The more direct precursors of the PDAF are the Corazon Aquino-era Php480 million Mindanao Development Fund (MDF) and Php240 million Visayas Development Fund (VDF) of 1989 which, upon the addition of Luzon, became the Php2.3 billion Countryside Development Fund (CDF) in 1990. CDF allotments to legislators were considered base figures and could be supplemented by so-called Congressional insertions; in the case of close allies of the president these could reach many times CDF allotments.
There were estimates in the mid-1990s that 60-90% of the value of CDF projects were going to the pockets of legislators and their accomplices. This implies only 10-40% implementation of projects. The CDF continued to grow, changed its name to PDAF in 2000, and stood at Php25.2 billion in the proposed 2014 budget. In the case of the Napoles scam, allegations are that 100% of the PDAF is lost to kickbacks divided 50% to legislators, 10-15% to implementing agencies and local government units, and 35-40% to Napoles herself. This implies zero implementation of projects.
There are already examples of abuses of most major categories of presidential pork barrel. In the case of PDAF/SPF there is the Napoles NGO scam involving Php10 billion over 10 years with Php581 million in kickbacks allegedly going to five senators. A COA audit report on PDAF/VILP meanwhile found Php6.2 billion worth of “not proper and highly irregular” NGO projects in the 2007-2009 period by 12 senators and dozens of representatives. The audit distinguished Congressional pork between PDAF ‘soft’ projects (i.e. livelihood, education, health, financial assistance and small infrastructure) and Various Infrastructure including Local Projects (VILP) ‘hard’ public works. The COA report has been criticized for its selectivity though in covering only 35% of some Php116.1 billion in total releases over the period covered, for focusing on opposition senators, and for not covering releases from 2010 during the current Aquino administration.
The Php12.8 billion channelled to legislators under the Disbursement Acceleration Program (DAP) by Pres. Benigno Aquino III, allegedly to be able to get a conviction for former Chief Justice Renato Corona during his impeachment trial in May 2012, is an example of the misuse of ‘savings’. It has been reported that 20 senators received Php40-100 million and representatives from Php10-15 million on top of their PDAF allocations. Total DAP releases have so far reached Php137.3 billion – with the DAP fund reportedly coming mainly from unreleased appropriations and partly from the unprogrammed funds. The constitutionality of the DAP is already being challenged.
The Malampaya Fund scam is an example of the abuse of off-budget items. Former president Gloria Macapagal-Arroyo and three cabinet secretaries, among others, are alleged to have received Php337 million in kickbacks from transactions worth some Php900 million. Pres. Benigno Aquino III has reportedly used Php18.5 billion of the fund since taking office. The COA previously reported a Php1.5 billion discrepancy in the MVUC where Land Transportation Office (LTO) collections worth Php71.9 billion over the period 2001-2010 were not fully reflected in Bureau of the Treasury (BTr) certifications of deposit which only amount to Php70.4 billion.
There is also an economic concern regarding pork barrel funds. The arbitrary, discretionary and patronage-determined use of public funds is an irrational and wasteful use of scarce government resources. Public funds should be consistently spent according to a larger socioeconomic plan that identifies development priorities and allocates finite resources between competing uses for maximum social and economic impact. The demands of real agrarian reform, pursuing agricultural development, building Filipino industry and providing vital social services to the people are vast enough as it is.
Yet it is irrational for public funds to be spent according to the whims of individual politicians whether the president, senators, representatives or other officials. Such decentralized decisions will tend to be parochial, misguided, based on incomplete information and even self-serving. It will be wasteful in the worst instances that funds are partially or wholly diverted to the pockets of corrupt politicians, government officials, middlemen and non-government racketeers.
Bureaucrat capitalism
There are three main aspects to the issue of pork barrel and, in particular, presidential pork barrel. The first is corruption which has underpinned the spontaneous outburst of rage on the part of millions of Filipinos. Plunder and malversation cases related to abuses of the PDAF and Malampaya Fund have already been filed against high-ranking government officials. Yet while the most sensational this is by no means the entirety of the issue.
There is, second, the patronage aspect and the conscious decision by every president to preserve and use the elaborate pork barrel system to remain in power and exert political influence. The Aquino administration’s alleged use of DAP in the partisan political campaign against a sitting chief justice could be a recent example of such a practice. Apart from the DAP the Aquino administration has also dispensed Php60.4 billion in PDAF to 21 senators and 285 representatives between July 2010 and July 2013. Any patronage-driven or politically-motivated use of public resources at the level of the presidency propagates an undemocratic and feudal political culture which is reproduced all the way down to the lowest barangay level of governance.
The Aquino administration’s recent declaration that the PDAF will be abolished is disingenuous – the presidential pork barrel apportioned to legislators remains but now with legislators even more dependent on the discretion of the president. Pres. Aquino meanwhile keeps direct control of hundreds of billions of pesos that can be dispensed to allies, or withheld from opposition, or otherwise used to purchase political support. There is no reason to expect an end to the spectacle every six years of legislators changing to the newly elected president’s political party.
Patronage also wrongly makes public and social services something that political patrons dispense for loyalty and support rather than services that every Filipino is entitled to as a matter of right. Every beneficiary of medical assistance or scholarships from pork barrel funds for instance deserves and should be benefiting from public health care and education without having to depend on the discretion of any politician or government official.
Third is how the pork barrel system is used to ensure that the government serves the interest of big domestic and foreign elites. Various administrations have used the persuasive and punitive powers of the pork barrel to produce the current array of anti-people economic and political policies that keep the majority of Filipinos economically destitute and politically marginalized. This happened at least as early as 1946 when then president Manuel Roxas reportedly used pork barrel to get legislators to ratify the Bell Trade Act which ensured US domination of the post-independence Philippine economy. Similar benefits until today ensure that big business is a reliable provider of funds for the electoral war chests of candidates including those, such as the president, who overtly wield pork barrel as a tool of governance.
Seen in this way the pork barrel emerges as just one aspect of the much more expansive and multifaceted problem of bureaucrat capitalism where the enormous resources and power of the State are used for private profit and personal gain by those within or outside government. This is a gross distortion of public service and a deep form of corruption.
The different areas of public power are abused in many ways. The pork barrel controversies of officials getting kickbacks from public projects are examples of misusing the government’s fiscal powers. Other examples include officials paying themselves hundreds of millions of pesos in excessive salaries, bonuses and benefits such as in the case of the Metropolitan Waterworks and Sewerage System (MWSS) board members, Social Security System (SSS) board members, PhilHealth and PCSO. There are also the notorious payoffs for tax evasion and smuggling.
The government’s regulatory authority is likewise misused with payoffs for franchises, contracts and bypassing regulations, as well as kickbacks from asset sales and bribes around big privatization deals. Legislative powers are abused whenever big business pays off lawmakers to get favourable laws, investor incentives or trade deals. Judicial powers are misused whenever favourable court decisions are bought. Military and police forces are directly involved in criminal activities as well as used by the government to suppress dissent or assertions of social and economic rights that threaten landlord earnings or capitalist profits.
Remedies, reforms and struggles
The president’s patronage and pork barrel scheme is one of the most obvious manifestations of a government serving mainly the interests of the country’s political and economic elite rather than the majority of the people. It is deeply undemocratic and anti-development.
The abuses of the pork barrel system are slowly being exposed which naturally leads to demands for greater transparency and accountability. Real transparency and then accountability in the misuse of pork barrel however cannot be selective and must cover both opposition and administration officials. These must also go beyond the concern about plunder and malversation to also include the use of public funds for patronage, partisan political purposes, and pro-elite governance.
There are urgent and immediate reforms. The pork barrel in all its forms within and off-budget needs to be abolished and controls instituted. These funds need to be removed from the discretion of the chief executive – whose powers over budgets must also be reduced – and subjected to greater public oversight. It is difficult to expect this either from the presidency, which is the main beneficiary of the pork barrel system, or from Congress which is in many respects controlled by the president aside from also benefiting from the system. These make the process of lawmaking through a people’s initiative, though complicated, a potentially productive option.
Steps can also be taken to improve transparency and accountability such as passage of a meaningful Freedom of Information (FOI) law and reforming the COA to better fulfil its mandate of operating autonomously in the public interest.
The arbitrary, discretionary and patronage-driven use of hundreds of billions of pesos in public funds is an irrational and wasteful use of scarce government resources. These should be rechanneled to social services and regular agency budgets according to a socioeconomic plan that prioritizes people’s needs and welfare above all. Progressive party-list groups have already identified where these funds can be spent for additional health (Php96.5 billion), basic education (Php63.3 billion), higher education (Php33.4 billion) and housing (Php10.0 billion) services as well as government salaries, subsidies for farmers, and other welfare support.
The outcry against the pork barrel has renewed public interest in social issues and stimulated even greater activism. These are real foundations for meaningful change however the pork barrel issue plays out. ###
