The former chairman of PAGCOR Mr. Efrain Genuino was, per a Commission on Audit report, the highest-paid government official in 2010 and received a total of P287.4 million in salaries and allowances. That made us think of the huge amount in the annual budget that goes to the “Intelligence Fund” of government offices. For the report about Mr. Genuino’s pay and allowances said some of it came from PAGCOR’s intelligence fund. 

Recall that the rubric “intelligence fund” was also used to justify the release of huge amounts—one of this was said to be P325 million—by the Philippine Charity Sweepstakes Office (PCSO) under the previous administration to former president and now Pampanga Representative Gloria Macapagal-Arroyo. Prosecutors are using these “intelligence fund” releases as the basis for some of the plunder charges leveled against Mrs. Arroyo and the past PCSO manager Ms. Rosario Uriarte.

Why should the practice be continued of giving practically every government office or entity an intelligence fund? Why should hundreds of millions in confidential funds subject only to the most peripheral auditing and the most lenient fund-liquidation process be given to government offices and corporations, while we hear reports that the Armed Forces of the Philippines’ intelligence sections are hungry for money needed to buy necessary equipment and finance their investigations?

Why doesn’t the bulk of these intelligence funds be used for the activity most necessary for development and which immediately creates jobs—infrastructure building?

The IMD World Competitiveness Yearbook

The Lausanne, Geneva-based International Institute for Management Development, or IMD, publishes the World Competitiveness Yearbook (WCY). The IMD Yearbook for 2011 reports our country to be, again, near the bottom in competitiveness. We have slipped from 39th to 41st place in the 2011 WCY out of 59 economies assessed. 

President Bengno Aquino was concerned by our demotion. So he released an executive order placing the Philippine Competitiveness Council under the Department of Trade and out of the President’s Office.

The report shows the Philippines ranking poorly in foreign direct investments, basic education, basic infrastructure and scientific infrastructure. We, however, earned good marks for worker skills, number of women holding top management posts, labor productivity, and labor market efficiency.

Tied for No. 1 are Hong Kong and the United States. Singapore, which was No. 1 last year and the year before dropped to No. 3. All our fellow original founders of the Association of Southeast Asian Nations (Asean)—Indonesia, Malaysia, Thailand and Singapore—are way above us.

The IMD suggests that the Philippines focus efforts to improve in lowering the cost of doing business, giving access to basic education, building scientific infrastructure, increasing energy facilities, improving transportation and the value chain and in building and maintaining basic infrastructure.

Infrastructure and competitiveness

There is a palpable and computable correlation between a country’s competitiveness—its productiveness, its success as an exporter, its people’s educational attainment and skills, its government’s efficiency, its superiority in the scale of economic indicators—and its basic infrastructure. 

The IMD WCY states that in basic infrastructure, the Philippines is near the bottom—57th out of the 59 countries covered. As anyone who has been to those countries can attest, we are way behind the five other Asean countries covered by the WCY‚—Indonesia, Malaysia, Thailand and Singapore—in the length, width and quality of our roads and highways. We are also behind in the number and quality of our bridges, airports, seaports, irrigation, farm to market roads, public markets, etcetera.

For years now, the building of basic infrastructure has been neglected in the Philippines. And the small part of the national budget for infrastructure building has been virtually halved by leakage to corruption. 

Government spending on basic infrastructure building has been only less than 2.5 percent of our Gross Domestic Product (which is considered a measure of the size of the whole economy). The infrastructure-spending norm should be at least 5 percent of GDP for the middle income countries of East Asia like the Philippines to experience development.

Basic public infrastructure spending is not only that of the national government but also those of local governments and the government owned corporations and institutions (like Subic). The sad situation is that total spending on public infrastructure was only 2.54 percent of GDP in 2010, and this year would amount to only 2.33 percent of GDP. It is estimated to rise to 2.41 percent in 2012. 

That means our spending on roads and things that will make agri-business more viable and profitable, create more jobs, is not even half of what is needed.

If the hundreds of millions that went to Mr. Genuino and the other highly paid public officials were poured into public infrastructure building instead, there would have been an immediate increase of jobs—just on the additional number of construction workers hired. 

The increase of farm-to-market roads and public markets would have made a difference in the incomes and entrepreneurial activities of the rural areas. The frequency of ro-ro trips would have also decreased the cost of inter-island transport. The building of more energy-generating facilities would have decreased the brownouts and increased overall economic activity.

Abolish the non-AFP intelligence budgetOur lawmakers and the relevant officials in the executive department should immediately work on abolishing or at least vastly reducing the “intelligence fund” for offices and public corporations.

Doing that will immediately remove another area where corruption can happen.

original source: http://www.manilatimes.net/