Virata calls for merger of DA, DAR

Bankers Association of the Philippines (BAP) president Cesar E.A. Virata, a former finance minister during the Marcos administration, is urging government to seriously consider the merger of two government agencies – the Agriculture and Agrarian Reform departments – and the further outsourcing of infrastructure contracts from graft-ridden Department of Public Works and Highways (DPWH).

Virata said the administration should consider the merger of the two departments, although stressing the security of employees’ tenure, as a means of streamlining the bloated government bureaucracy.

He said the National Power Corp. (Napocor) must be also privatized at the soonest time to plug the agency’s debts estimated to reach P100 billion this year.

He likewise recommended that government should continue to implement dramatic reforms at the DPWH, which has remained in the perception of many as among the most corrupt government agencies. Corruption results in huge losses in government coffers, depriving other socially-sensitive agencies such as education, health and other basic services.

Virata also expressed grave concern over the country’s inability to stop the ballooning budget deficit due to poor revenue collections and lavish spending.

"We must reduce the high deficit and place limits to our borrowing to feed the shortfall," he said during a forum sponsored by the Rural Bankers Association of the Philippines (RBAP) and its regional affiliates in Southern Luzon and the National Capital Region.

Stricter monitoring of operations and expenditures must be put in place while opening more public biddings to private sector involvement in infrastructure development. "We must consider more outsourcing in a very transparent way."

Uncontrolled spending forces government to borrow further which results in direct competition with borrowings by the private sector. This in turn forces interest rates higher, thus depressing economic growth.

The country’s deficit amounted to nearly five percent of gross domestic product (GDP), and is expected to hit P198 billion this year.

"Whoever wins in the coming elections must dramatically change these conditions. No more over-lapping of functions. The new administration must economize, and there are few alternatives," Virata added.