For the Duterte administration, the abolition of the allegedly corruption-plagued Road Board and the transfer of its funds sourced from the collection of the Motor Vehicle User’s Charge (MVUC) to the state’s General Fund were done deals, Finance Secretary Carlos Dominguez III said yesterday.

Leaders of the House of Representatives had held up the approval of the budget and are now saying they would review the 2019 General Appropriations Bill due to the “widening fiscal deficit.”

Budget Secretary Benjamin Diokno, who is also being targeted by House leaders by linking him to corrupt practices, had revealed that he refused demands from legislators to release money from the P45-billion Road Board fund.

Diokno said the Road Board has been the “cash cow” of the previous administration.

Dominguez said the House measure of former Speaker Pantaleon Alvarez abolishing the body, which the Senate adopted, was already “covered by the original proposal of the Department of Finance (DoF) to Congress under the Duterte administration’s Comprehensive Tax Reform Program (CTRP)” or what is now the Tax Reform for Acceleration and Inclusion (TRAIN) law.

Dominguez said making the current and future funds of the Road Board as part of the General Fund will ensure that their appropriation is scrutinized by lawmakers as part of the normal budgeting process.

The reform of the MVUC by adjusting its rates to account for inflation and simplifying it by collapsing the multitude of rates into a single one based on weight is included in Package 1-B of the CTRP, Dominguez said.

Complementing proposed reforms by the DoF is the abolition of the Road Board, which is authorized under Republic Act 8794 to manage and utilize the MVUC funds.

The DoF also specifically proposed to Congress that the Road Board funds be transferred to the General Fund.

“We want the current and future funds now earmarked for the Road Board to be part of the General Fund, which will then be appropriated by the legislature as part of the normal budgeting process and not allocated by an unelected Board, which lessens the transparency on the use of the funds,” Dominguez said.

Finance Undersecretary Karl Kendrick Chua said, since both the Senate and the House had approved the bill abolishing the Road Board, the DoF did not find it necessary to include in its 20 September 2018 letter to Congress a request for its abolition and instead detailed the remaining tax reform proposals under the CTRP, which it asked lawmakers to approve.

Chua “Both the House and Senate passed the bill on the abolition of the Road Board, which was in response to our proposals as outlined under Package 1-B of the CTRP,” Chua said.

“As Congress already passed this proposal, the DoF’s letter to the House leadership requesting it to pass the remaining tax packages expectedly does not include the Road Board abolition. The DoF-proposed restructuring of the Motor Vehicle User’s Charge does include the transfer of the road fund to the General Fund,” he said.

Chua said a House leader erroneously pointed out “even the DoF did not want the Road Board abolished,” because its letter to the House did not mention this when it formally asked for the restructuring and adjustments in the MVUC as part of its appeal for the approval of the Duterte administration’s remaining tax reform packages.

Last 12 September 2018, the Senate adopted the House version on the Road Board abolition to dispense with the bicameral conference process. The House, however, rescinded its approval of the bill on third reading on the same day.

“While the transfer of the Road funds to the General Fund will improve the transparency and accountability of its use, it does not add any revenue at all, as the MVUC is also part of the existing revenue base,” Chua said.

He added the only adjustment to the MVUC rates will increase revenues earmarked for road repairs, air pollution control and road safety improvements.

Senators yesterday expressed support to President Rodrigo Duterte’s plan to use the tax fund for flood control projects and for relocation sites in the Bicol region.

The President made known his intention following the havoc wreaked by tropical depression “Usman” in Region 5 where at least 126 people died, mostly due to landslides.

Mr. Duterte particularly said that Housing and Urban Development Coordinating Council Chairman Eduardo del Rosario could use the fund for permanent relocation of residents in safe areas in Albay and Camarines Sur.

The President stressed that he will allow the release of the P45-billion Road User’s Tax (RUT) only if it is intended for good use, as he slammed corruption in the utilization of the fund in the past.

Sen. Joseph Victor Ejercito urged that part of the fund should be retained for road safety projects.

“While I support PRRD’s (Mr. Duterte’s initials) proposal, I suggest that the portion for road safety projects be retained and the remaining portion be allotted for the suggestion of the President,” Ejercito said.

JV EJERCITO (Photo by ALFONSO PADILLA) “We cannot sacrifice the whole road safety program. This would mean saving lives, too,” he added.

For his part, Sen. Sonny Angara also welcomed the President’s move, but explained that until the Road Board is abolished, an amendment to the law is necessary to allow such utilization of the fund.

“It’s a good idea since that is public money anyway, but the law on the road board needs to be amended if that is the purpose, because there are limited uses under the Road Board law,” he said.

Angara, however, stressed that when the board is abolished, the RUT will automatically go to the general fund of the government.

In a statement, a House leader said that the government disbursement continues to outpace the increase in revenues, saying that the numbers of the fiscal deficit for 2018 “do not look so good.”