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Decoding Arroyo’s medium-term plan

July 25, 2007

Three years ago, the Arroyo government conceptualized a fea-reaching blueprint that would guide the direction of the country in the next six years.
This national blueprint dubbed as the Medium-Term Philippine Development Plan (MTPD), which is being advertised as the crowning glory of the first 100 days of President Gloria Macapagal-Arroyo’s fresh six-year term, would serve as the fountainhead of all economic, fiscal, social, political and educational programs of the current administration.

It is the “alpha and omega,” so to speak, of the Arroyo regime, and its focus is to combat poverty and create wealth.
“The basic task of the Medium Term Philippine Development Plan for the period 2004-2010 is to fight poverty and build prosperity for the greatest number of the Filipino people,” said Mrs. Arroyo.

To achieve this goal, the President maintained that there is a need to bring in economic opportunities, to keep socio-political stability, and to promote good stewardship so “to ensure a better quality of life for all our citizens.”
With the help of her economic team and other core agencies of the government, the President set her focus on strategic measures and endeavors that will “spur economic growth and create jobs.”

All the ten-point agenda of the President were encapsulated in the Plan drafted by the National Economic and Development Authority that seeks to achieve the following fighting targets:

  • growth in gross domestic product by 7-8 percent by 2009-2010;
  • investment to GDP ratio up to 28 percent by 2010;
  • growth in export by $50 billion by 2006;
  • a balanced budget by 2010;
  • annual job creation exceeding 1.7 million jobs by 2009;
  • reduction of poverty to below 20 percent by 2009.

Based on the above-given goals, there exist two targets that directly affect Filipino students: one assures the creation of jobs, which is easier said than done considering the dramatic state of the country’s education and unemployment, and the other reduces the incidence of poverty.

But just how viable and measurable the MTPD’s goals and targets are?
It’s been three years since the nanosecond implementation of this Plan, but it seems that the government is still struggling to fully deliver its promise since it confronted serious political and corruption scandals, such as the Hello Garci controversy, jueteng issue, bribery, charter change, etc.

The Plan, which is aimed at systematically eradicating the repulsive face of poverty in the country, speaks of the general agenda of the President and her planners. How to stamp out poverty is one big question; but how to achieve the ambitious wordings of the Plan is but another troubling predicament.
Among the main features of the MTPD is the reinvigoration of the country’s educational system. Indeed, the planners, who are experts in their own fields, are not unaware of the crucial rule of education in “nation-building.”

They admitted the fact that the quality of the country’s basic education has been deteriorating continuously.

Education officials and even lawmakers had long acknowledged that the quality of Philippine education has been constantly in the wane for roughly 25 years.
This confession is a devastating report card for politicians who managed this nation in previous decades.

Philippine presidents made it a practice to conceive plans and agenda that would serve as a guide throughout the duration of their terms.

Like the term of President Arroyo, her MTPD also greeted serious qualms and criticisms.

First to comment on the Plan was the United Nations, which first cast doubt on its viability.

UN consultants who were invited in 2004 to study the content of the MTPD raised qualms about the Plan’s goals of sustaining a 7-percent economic growth and halving poverty.

They said that however noble its intention, the Plan will remain toothless without addressing the main issue of the problem. The government, they said, must take a proactive stand in managing one of the very sources of the problem – population growth.

To counter the ill effects and the very foundation of poverty, apart from the ongoing counterinsurgency operations, is the battle being fought for by the Arroyo regime.

However, the government did not elaborate on how it would alleviate poverty. It only enumerates areas to be taken into account, like (1) economic growth and job creation; (2) energy; (3) social justice and basic needs; (4) education and youth opportunity; and (5) anti-corruption and good governance.

All of these may sound idealistic and pleasing, but are they being implemented seriously and properly, or they are just mere trappings of the current regime?
Broad, vague and unclear—these may well describe the contents of the Plan.
Consider this: the ongoing counting of ballots threatens the President’s control of the Senate. Businessmen expressed concerns that an opposition-dominated senate might impede all the legislative plans of the government. Most corporate leaders, according to a BusinessWorld report, said they would be more comfortable if both houses of Congress were controlled by the administration, pointing to the prospect of quicker approval of needed legislation.

If the Hello, Garci controversy had altered the political landscape of the country, MTPD in general instigated a series of changes in the archipelago’s tri-polar order – politics, economy and society.

Change has a price; it also has consequences. This is what happened in the past three years, and whether the change would yield positive or negative results, only time can tell.
If the Plan’s main goal is the pursuit of happiness, it is but important to consider the following questions:

1. How much will it cost?

2. Where will they source the funding?

3. Do they have the political will?

4. What is their top priority?

5. Do they have the expertise?

6. Do they get the backing?

7. Finally, do they have the credibility?

The first question refers to the fiscal aspects of the plan. This is because nation-building requires a huge amount of budget apart from the expertise needed to institute national reform. That’s why most businessmen believe that political dominion in the two houses of Congress is much needed for speedy legislation.

Several fiscal reforms were instituted in 2004. The Philippines during that time can be likened to a state preparing for war, as administration legislators of the lower house, led by Speaker Jose De Venecia, double-worked to speed up the legislation of eight tax bills that would provide the much needed muscle for the Plan. But it seems that the proceeds of these tax laws would not be enough to meet the MTPDP’s funding requirements.

The stakes are high as the government would need some P1.511 trillion for capital outlays, including P1.171 trillion for infrastructure and other capital outlays.

UN representatives raised doubts that a 7-percent growth can never be achieved without income in public expenditure. It was said that an increase in capital expenditure of 2-percent would not be enough to finance the proposed public investments.

Arroyo’s economic planners, however, predict that minus the proceeds of eight new eight tax bills, the plan provides for an average 11.6 percent rise in revenues over its six-year time frame, with tax receipts alone rising 13.2 percent.
To achieve this, the following schemes must be strictly followed: there be 10 percent average annual increase in fees and charges, three percent to five percent increase in petroleum import duties, stricter tax enforcement, and “the successful carrying out of innovative sources of wealth creation.”
The government also considered privatizing the National Power Corporation’s assets, fully operating Mount Diwalwal, developing more gas and oil wells, carrying out reclamation projects and nationwide reforestation and establishing Hong Kong-type hubs for foreign investors as avenues for wealth creation.
NEDA director general and socio-economic planning secretary Romulo Neri said the funding would have to come from the private sector and official development assistance.

Foreign investment was eyed as the main source of funding for the six-year plan. But there was a question whether investments would come in droves in the next two years.

Money is just the entry point of the Plan.

One of the ironies of development is that it requires huge outlays. But that is just the fiscal part of the Plan. What about the political will of those in power, including those who were tasked for its implementation?

Political will is another story. Really, it’s the heart of the story. They say, things are easier said than done. The Plan, indeed, serves as a litmus test for the Arroyo government whether it has the political will to institute reform. But reform should start first in Malacanang, including every agency, office, bureau and instrumentality of the government. From the highest official of the land to the lowest paid casual of an agency, character change must first be instituted.
Bureaucratic and systematic corruption that has already morphed into hideous norm is one of the biggest humps of national development.

The Philippines, according to reports, is the most corrupt country in the region, a demoralizing assessment of those in power.

Finger pointing also went in the direction of some members of the first family, including the President herself, in connection with corrupt practices. Jueteng allegations, red tape, extortion, plunder and election cheating hounded the entire first family since Mrs. Arroyo assumed office in 2001.

Part of the MTPDP is the plan to change the charter, because according to the President, it is already obsolete and is the source of all evils like red tape. Instead of getting the support of the people to help push government’s development plans, the issue of charter change even tore apart this already long divided nation.

Aside from that, the government also waged war against insurgents, thus widening the extent of its enemy line. Along with these political events were climate of political/extrajudicial killings and cases of desaparecidos.
All of these incidents characterize a “weak state,” which means a state that cannot fully protect its people against extrajudicial crimes, human rights violations, police violence, including foreign intervention and control.
In a few days, newly elected senators will be declared. People expect a political imbalance after the counting of votes. Pre-election surveys, exit polls and media quick counts have shown that majority of opposition candidates are likely to join the senate. However, the President is likely to control the lower house with the election of De Venecia and most of her congressional allies.

But with mounting allegations of cheatings, intimidations and other election-related violence, the new batch of opposition is likely to seek revenge by filing another impeachment complaint against Mrs. Arroyo.
If elected, detained Navy Officer Antonio Trillanes, Pateros Rep. Peter Cayetano and their allies, and those extreme oppositionists in the lower house who cried election cheatings and violence would cast their even more intense rage at the Malacanang Palace.

It is most likely that the next congress would be another venue for impeachment complaint, probes on election cheating and a series of legislative inquiries, things that would bushwhack set goals of the administration.

The problem is the government is doing just the opposite thing. People between and around the President might have forgotten that there can be no unilateral step towards national development. This is because nation building requires multilateral action; it needs the participation of not only government agencies, bureaus and offices but also that of the private sector, academe, business sector, and every unit of society.

Three years after the Plan’s inception, it can be said that the government has taken the impossible path towards what it calls national development. Since 2004, the Arroyo Administration made enemies left and right, a scenario that isnot helpful to a regime seeking unity and progress.

The steps taken by the Arroyo government is somewhat identical to that unilateral strike of America after September 11. However, American experience is different from ours. Without any doubt, September 11 helped America achieve unity, and galvanized both the US congress and the senate into passing tax laws that would finance its then impending battle versus terror and ratifying the Patriot Act that put the entire country under a state of war on global terrorism. America’s enemy is not within its territory.

In the case of the Arroyo government, the military is fighting against an enemy within the four corners of the archipelago. The result is even worse, because a huge amount of government’s fiscal earnings were diverted to its fight against insurgents.

That’s why there’s a need for the Arroyo government to redefine, redesign and reengineer its goal. Hence, aside from the aforementioned methods, it is important that the following steps be taken:
1. Prioritize government’s plans;
2. Take one step at a time and consult the people;
3. Establish unity rather than make enemies;
4. Protect the human rights of the people;
5. The President must be in full control;
6. The President should sack her erring and arrogant officials like Justice Sec. Raul Gonzales, Comelec chair Benjamin Abalos, Executive Sec. Eduardo Ermita, Ombudsman Merceditas Gutierez.
7. Strengthen justice system and carry out a war of attrition on graft and corruption;
8. Ensure credible and honest elections in the future;
9. Forget charter change;
10. And finally, redeem the trust and confidence of the people.

Click here for the summary of GMA’s MTDP

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