Ernesto M. Pernia, PhD

Socioeconomic Planning Secretary

Senate Hearing on Senate Bill No. 1938 or

“The National Economic and Development Act of 2018”

Senate Session Hall, 2nd Floor, Senate Building, Pasay City

28 August 2018, 9:00 AM

Senate President Vicente “Tito” C. Sotto,

Senator Sherwin “Win” T. Gatchalian,

Honorable members of the Senate Committee on Economic Affairs,

My colleagues in NEDA,

Co-workers in government,

Ladies and gentlemen, good morning.

For the past 45 years, the National Economic and Development Authority (NEDA) has been consistent and faithful in performing its mandate as the country’s premier socioeconomic planning and policy-coordinating body. NEDA’s roots, in fact, can be traced to as far back as 1935 with its predecessor agency, the National Economic Council (NEC). Through the years, the NEDA has been driven by its mission of formulating continuing, coordinated, and fully-integrated socioeconomic programs and policies for the development of our country, in coordination with various agencies.

The current structure of NEDA dates back to the 1987 Philippine Constitution and Executive Order No. 230, dated July 22, 1987, with then President Corazon Aquino exercising legislative powers before Congress resumed.

Article XII, Section 9 of the Constitution contemplates the creation of an “independent economic and planning agency” to be headed by the President. The Constitution likewise authorized NEDA to function as the independent planning agency of the government until otherwise provided by Congress. This was stated earlier by Senator Koko Pimentel. However, an enabling law to fully exercise such function has never been passed until now. I think you’re very aware of this, Mr Chair.

Since then, NEDA has faced challenges as new developments and changes arise in both economic and governance aspects.  The current set-up is no longer adequate for NEDA to be able to fully exercise its oversight function. With various reform initiatives that are often myopic rather than holistic, the government’s planning, policy-making, programming, and budgeting process has become fragmented, uncoordinated, and often interrupted. Implementation of plans, programs, and policies has many times been delayed and inefficient. Even the sensible policies and programs that address root causes of problems with long-term impact often get disrupted, discontinued, or not given due attention. Unfortunately, even with its high competency and quality outputs, NEDA’s powers as an oversight body remains limited to coordinating plans and recommending policies.

It is noteworthy that we now have AmBisyon Natin 2040 which articulates the country’s long-term vision based on people’s aspirations, and has been adopted by the President as a guide for long-term development planning across administrations. Yet our stakeholders often express concern that this will suffer the same fate of other well-intentioned government initiatives if NEDA is not sufficiently empowered and effective as an economic manager and development leader.

This is why the NEDA family welcomes—and is deeply grateful for—this landmark legislation introduced by Senator Win Gatchalian. In fact, you have motivated us to get this initiative, to start thinking about how to strengthen NEDA. We share the honorable Senator’s vision of having a culture of participatory planning instilled in the formulation and implementation of the country’s economic and development policies.

This proposed legislation is a long overdue response to the 1987 Constitution. The passage of this NEDA Act of 2018 will finally recognize the agency’s independence in implementing socioeconomic plans, programs and policies as provided for in the Constitution.

Moreover, the Act institutionalizes a “Planning Call,” similar to that of DBM’s “Budget Call,” that will ensure a timely and coordinated planning process — with active participation especially of all pertinent agencies of government — and will secure the required funding for programs and projects in the Medium-Term Development Plan, as you also have indicated Mr. Chair. The Act also establishes a Long-Term Development Plan that will ensure that plans and programs are continued seamlessly through succeeding administrations.

It is our fervent hope that this august Committee of yours, Mr Chair, will find merit in this proposed NEDA Act and accordingly endorse it. Rest assured that we in NEDA will work even harder, as we have done in the past, with the authority granted to us by law, to help the country achieve self-sustaining and inclusive economic growth that empowers every Filipino to live a matatag, maginhawa at panatag na buhay.

Thank you and good morning.