The Cebu City Council is set to approve on Monday the city’s biggest ever annual budget.
This bodes well for the country’s biggest city outside Metro Manila. It affirms the sound economic and governance vital signs.
As expected, the Council, which is controlled by the local opposition Bando Osmeña – Pundok Kauswagan (BOPK), slashed Mayor Michael Rama’s proposed P18.9 billion budget for 2015 to P13.4 billion. Still, the amount is more than double the P5.9 billion budget for this year.
Budgets describe a plan for managing funds. It is not real money. It is monies yet to be earned.
How did Cebu City do in the last two years? In 2013, City Hall’s projected income was P6.4 billion but earned only around P4.8 billion.
This year, with an approved budget of P5.9 billion, City Hall is looking at a deficit or revenue collection shortfall of P1.2 billion as of November.
In one of his roundtable discussions with news executives early this year, Mayor Rama bewailed the City Council’s role a the Grinch for not giving him what he needs to make Cebu safer from crime, disasters and man-made calamities. He wanted to upgrade the city’s drainage and flood control systems; have more modern fire fighting equipment and more police cars, etc.
He said Cebu City was rich, and in fact was sitting on its wealth. He pointed to prime real estate like Block 27 in the North Reclamation Area, the 300-hectare mostly unoccupied South Road Properties (SRP), and many, more.
He’s right about the potential. The other side of the equation is generating real revenue.
The City Council, whose budget committee is headed by Councilor Margot Osmeña, wife of his political nemesis Tomas Osmeña, has been on his back reminding him to appropriate only what City Hall actually earns and to spend within the city’s means.
With the impending approval of next year’s budget, things may turn out differently. The City Council may finally give Rama his pet projects which he insisted is for the public good.
In the slashed 2015 budget, P10 billion or almost half will be supported from future sales of city -owned lots, primarily in the SRP, the rest from real estate taxes, Internal Revenue Allotment and local enterprises.
Loose ends need to be addressed: fiscal management.
Cash-flow problems at yearend clearly show in the non-release of the full P5,000 balance of senior citizens aid. (Part of it, P3,000 will be given on Dec. 22.) No less than City Treasurer Diwa Cuevas dropped the bombshell that a P300-million outlay set aside for Phase 1 of the new Cebu City Medical Center, would be used to satisfy the promise to seniors.
“It’s a practice of the office. When CCMC starts, I can assure that we can already pay,” she said. Making a new promise to carry over to next year is very significant, if we’re talking about dipping into funds set in trust for the mayor’s centerpiece project. That kind of fund juggling may not be outright illegal, but it doesn’t speak well of the administration’s foresight or stewardship of funds.
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