To avoid a recurrence of the Marcos era debt trap, Opposition Senator Leila M. de Lima has filed a measure establishing a Comprehensive Debt Management System that will ensure transparency and accountability on all government borrowings.
In filing Senate Bill (SB) No. 1675, De Lima said Congress should exercise its oversight powers to scrutinize all foreign and domestic borrowings negotiated, contracted, or guaranteed by President Duterte.
“It behooves us to remember that it is unlikely that any administration goes into a borrowing spree with the intent to fall into a debt trap,” she said.
“Therefore, assurances aside, there remains a need to institute reforms and safeguard to avoid a recurrence of the Marcos era ‘death trap,'” she added.
Under SB No. 1675, also to be known as the Comprehensive Government Debt Management Reform Act, the State shall pursue a Comprehensive Debt Management System that will “holistically manage all government borrowings through a unified government debt management policy.”
De Lima explained that the debt management policy should be “characterized by a stable and consistent long-, medium- and, short-term debt management and planning” and be able to “recognize the common pitfalls of poor government debt management,” among others.
“The foregoing problematic aspects of public debt exposes the country and its people to the risk of imprudent debt accumulation,” she said.
She also noted that the need for a holistic debt management system is made even more urgent in light of the current administration’s push for a “golden age of infrastructure,” which is expected to push the government’s debt level to even longer debt servicing timeframes.
“There is a need to make sure that the government’s spending and debt management policies match the country’s macroeconomic, social and other overall policies,” she said.
It must be noted that the present Duterte administration plans to roll out more than eight trillion pesos in public infrastructure projects from 2018 to 2022 funded mostly by foreign loans and overseas development assistance (ODA).
In her proposed measure, De Lima also underscored the need for a Congressional Oversight Committee on Debt Management to ascertain if the President’s borrowings and are done for the best interest of the country and its people.
It is also part of the mandate of the committee to review all existing laws, and implementing rules and regulations, and executive issuances relating to foreign and domestic borrowings.
“The Committee is empowered to require all government agencies concerned, including the Office of the President, to submit all pertinent information and data on foreign and domestic borrowings; Provided, however, that information or data that are privileged shall be furnished the Committee only in Executive Session,” she noted.