Business World, 6 January 2015

Benigno Aquino III’s term is winding down. It’s down to the last 18 months. On the economic front, there are a few things he can boast of: the strong growth in 2012 and 2013, the numerous investment upgrades, and his budget reforms.

Of the three, the last one is the most unworthy. The so-called budget reforms were found to be skin-deep when the Supreme Court ruled unanimously that the controversial Disbursement Acceleration Program (DAP) was unconstitutional. Add to that the Aquino administration’s record of underspending in the face of serious public infrastructure deficiency.

Why can’t the Aquino administration budget well? Why can’t it allocate funds appropriately and spend the budget as approved by Congress? Why is there a need to slice and dice the budget as authorized by Congress, generate contrived savings, and then spend the way President Aquino and Budget Secretary Butch Abad see fit?

During the twilight of his six-year term, Mr. Aquino is facing a lot of problems, many of his own making. His commitment to transparency lacks credibility, since to date he refuses to use the awesome powers of the presidency to have the Freedom of Information Act approved.

Sadly, the public infrastructure gap kept on widening, partly because of the slow decision-making process (for example, up to now it is not clear whether the new airport will be at NAIA, Clark or Sangley), the bureaucratic red tape, the lack of credibility (why are the big, reputable contractors shying away from doing public works projects?), and the deliberate underprovision in the budget.

It’s a puzzle to me why the President and his budget secretary refused to ask Congress for higher appropriations for public infrastructure at a time when interest rates were — and still are — at its historic low. I’m sure there is a long list of infrastructure projects that would give a return on investment much higher than the cost of borrowing.

Today, the miseries of the victims of Typhoon Yolanda have remained unaddressed. People ask: where have all the billions of government funds and donations of foreign governments gone?

Mr. Aquino is now faced with the difficult task of adjusting the fares of the MRT and LRT at a time when services are sputtering. He missed the train, so to speak. What was he doing before? He should have adjusted the fares on his first year in office when he enjoyed very high approval rating.

Incidents of power outage now appear imminent four and a half years into his presidency. For an economy that needs new power capacity of about 600MW annually, why was it not on the Palace’s radar screen?

Mr. Aquino has spent a lot of time, effort, and billions of public funds cajoling a faction of the Muslim community and crafting the Bangsamoro Basic Law (BBL). Is the BBL really the solution? And where is it now? The BBL has yet to pass the legislative mill. It faces an uncertain future. Legal experts opine that it is constitutionally flawed. In the meantime, hostilities in the South continue.

Lots of public resources lost with no foreseeable positive outcomes.

As the economy grows, Mr. Aquino cannot claim that there has been an improvement in human condition and the quality of life. United Nations studies indicate otherwise.

What Mr. Aquino should know by now, if he hasn’t known it before, is that man does not live by GDP statistics and investment upgrades alone.

It is the human development aspect where Mr. Aquino failed miserably. Here, the government plays a crucial role. But what do the United Nations Development Program (UNDP) statistics show? Among ASEAN-5 economies, the Philippines deteriorated the most in terms of human development index from 2010 to 2013.

During Mr. Aquino’s watch, the Human Development Index (HDI) fell the sharpest for the Philippines compared to its ASEAN-5 neighbors — from rank 92 in 2010 to rank 117 in 2013.

While Thailand and Singapore have moved up sharply during the last four years — gaining 19 and 18 notches, respectively — the Philippines lost a staggering 25 notches. This shows by how much the human side of development has been neglected by the Aquino administration.

By the way, there’s no point boasting of the high growth rates in 2012 and 2013. It is easier to grow fast when one is starting from a low base. The inconvenient fact is that the Philippines remains the poorest among ASEAN-5 economies. It has a gross national income (GNI) per capita of $6,381, which is less than one-tenth of Singapore’s GNI per capita.

The human development index rises with better education, health care, and employment opportunities. As we enter the year of ASEAN economic integration, it is important that the government pays attention to education, health care and job creation. Yet these are the areas where we don’t compare well with our ASEAN-5 neighbors.

True leaders should be working for their constituents’ welfare — not for their own political fortune.

In his final days, Mr. Aquino ought to think of ensuring “human security,” which the 1994 Human Development Report described in the following words:

“In the final analysis, human security is the child who did not die, a disease that did not spread, a job that was not cut, an ethnic tension that did not explode in violence, a dissident who was not silenced. Human security is not a concern with weapons — it is a concern with human life and dignity.”

Mr. President, there are many things that need to be done yet during your last two minutes. Get cracking.