Proposed P100B budget ‘unrealistic’

Cebu City Hall.
Cebu City Hall.(Photo by Lujen Limosnero)

SOME Cebu City legislators have questioned the need to double the 2023 budget of P50 billion to P100 billion in 2024 when the City has been able to collect only P7 billion so far of this year’s budget.

“Are we really optimistic that we can get the collection of P100 billion for next year, granting that we (city council) will approve, nya di gihapon ta kakolekta, so di gihapon ta makagamit sa appropriation nato (but we still won’t be able to collect the amount so we end up not having enough to spend on our appropriations),” said City Councilor Noel Wenceslao during the budget hearing on Monday, Nov. 13, 2023.

He was directing his question to City Budget and Finance Officer Jerone Castillo.

In response, Castillo said the proposed budget is a collective study of the local finance, adding that they are confident that it can be achieved.

“Wa man sad mi mag-ingon nga automatic makuha (We are not saying we will automatically get the amount). There is just a positive and a very good confidence kay (because) we look at the economic indicators,” Castillo said.

He said economic indicators for the past 20 years have shown that Cebu City is growing at a really fast rate.

He said that when the economy grows, the tax base should also increase.

“If we grow economically, di ba ang (isn’t the) necessary consequence nga ang atong (is that the) tax base mu-grow sad siya (also grows) substantially... Magkuyog jud ng duha (The two go hand in hand)... Mao nang (That is why) on our end we are confident, but confidence has to be translated into actual work,” Castillo said.

Wenceslao also asked Castillo how much the City has collected since it launched the Strategic Assessment for Your Assets and Worth (Sayaw) para sa Buhis in July.

One of the program’s targets was to collect P28 billion in delinquent real property taxes.

Castillo replied that he has not gathered any data yet.

He said that when they launched the program, they had limited staff. When they later expanded their team, the staff still had to undergo training, he said.

“Ayaw sa jud expect so much nga paspas jud kaayo ta (Don’t expect things to move so swiftly)...Dili jud pwede nga dili i-train ang mga (We couldn’t proceed without training the) personnel,” he said.

Wenceslao said they are aware that accumulating funds is neither easy nor swift, which is why the council is asking for the specific amount the City can expect to generate.

“Can we collect this in one year?” Wenceslao asked Castillo.

Castillo said he cannot “second guess” because they will do it based on calculations.

He said there is no problem in appropriating a P100 billion budget since the City cannot spend anything without the actual money.

“While it is true that P2 billion was appropriated, only P1.8 billion was spent. It is always on the basis of the available tax. So for several years, Cebu City has been using the doctrine of ‘self-limiting,’” he said without elaborating.

He said the budget must be appropriated now because the City needs it to support its programs.

City Councilor Jerry Guardo, head of the committee on infrastructure, said raising the budget to P100 billion will lead to several departments also submitting bigger budget appropriations.

But he said the reality is the City barely collected 10 percent of the P50 billion for 2023.

Guardo said public perception on the budget appropriation is negative, adding that it is unrealistic.

“We approved the budget of P50 billion last year, pero (but) only 20 percent lang ang efficiency sa atong collection (but the collection was only 20 percent efficient),” he said.

Castillo said they are working to achieve the targeted amount.

“We are working on it every day... So what we are saying to the Sangguniang Panglungsod, klaro man kon asa ta magkuha (it’s clear where we will get the amount) but we also need your help,” he said.

Sources of funds

Based on the proposal that the executive department submitted to the council last October, the largest estimated revenue source for next year’s annual budget will be tax revenue amounting to P77.5 billion, followed by non-tax revenue amounting to P10.554 billion.

Other estimated sources of revenue are shares the City will get from various joint ventures amounting to P7 billion, P2.905 billion from the national tax allotment, P600 million from economic zones and P288 million from its share of the income of government-owned and -controlled corporations, such as the Philippine Amusement and Gaming Corp. and the Philippine Charity Sweepstakes Office.

The City is also looking to generate around P2.095 billion under its special accounts, including P150 million from the operation of city markets; P581 million from the local development fund; P1.185 billion from city hospitals; and P179 million from housing projects.

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