Fiscal reforms key to MDG’s

THE Philippine government would have to pursue fiscal reforms if it were to have a chance of meeting the United Nations’ Millennium Development Goals (MDGs), a nongovernment organization (NGO) said on the eve of President Benigno Aquino 3rd’s visit to the US. The President is scheduled to address the United Nations General Assembly and report on the Philippines’ progress in meeting the 2015 deadline for the MDGs. He is also set to sign an agreement with the US Millennium Challenge Corp. for the release of aid meant for efforts to pursue the Philippine MDGs.

“The passage of fiscal reforms is crucial in financing the MDGs. The government cannot just rely on improving tax administration as a measure to beef up revenue collection,” said Code RED in a statement.

“It has to be complemented with fiscal measures like rationalization of fiscal incentives, fiscal responsibility and excise tax on tobacco and alcohol and simplified net income taxation scheme [SNITS],” the NGO said.

The NGO said the first two reforms entail a streamlining of available resources, while the other two tax reforms would involve merely capturing foregone revenues brought about by loopholes in existing tax laws.

“It is crucial that the government prioritize the financing of the MDGs through fiscal reforms and other means as achieving the goals can very well be the gauge of progress in addressing poverty,” the NGO said.

Earlier, the National Economic and Development Authority said the government may address the MDGs pertaining to food poverty, gender equality in education, child mortality, malaria morbidity, detection and treatment success and cure rates of tuberculosis cases, and access to sanitary facilities.

The government however doubts whether it could attain the targets on income poverty; nutrition; dietary energy requirement; access to safe drinking water; participation, cohort survival and completion rates in elementary education; maternal mortality; access to reproductive services; and prevalence of HIV and AIDS.

In a forum held on Thursday, Social Watch Philippines blamed the country’s slow progress in attaining its MDGs on bad governance, inappropriate economic policies perpetuated in a massive outflow of resources through debt payments and corruption, lack of commitment and economic supply shocks such as energy and food crises in the past years as among the reasons for the slow progress.

“The Philippines is in a worse poverty situation in 2010 than when it started on the MDGs in 2000.

We are losing the war on poverty. Many would still be left behind, and their numbers are simply staggering by any count,” Isagani Serrano, Social Watch Philippines convenor, said in a separate statement.

“MDGs are severely unfunded,” Leonor Briones, University of the Philippine professor and co-convenor of Social Watch during Thursday’s launch of a book on financing the MDGs.

In the book, Social Watch said the government can look into five possible sources of financing the MDGs, namely domestic financial resources, trade, investments, official development assistance and debt.

Citing a study by state-run Philippine Institute for Development Studies, Code:RED said the government cannot afford to any budget cut in social services as the funding gap from 2007 to 2010 already stands at P395 billion, or 1.2 percent of the country’s economic output. –Manila Times