The House Committee on Appropriations has recently endorsed for plenary approval a measure seeking to improve the budget process by enforcing greater accountability, strengthening the power of the purse of Congress, and increasing budget transparency and participation.
Committee Chairman Rep. Karlo Alexei B. Nograles of the First District of Davao City, principal author of the bill, said the consolidated bill, which substituted 13 measures, will strengthen accountability and integrity in the use of public resources by ensuring transparency, fiscal responsibility, results-orientation, efficiency and effectiveness.
“The annual budget is the most important legislation that should be timely enacted by the government. It is through this tool that the government delivers basic services and provides public goods to the people. In order to fortify the budget process, there is a need to introduce budget reforms that will enforce greater accountability in public financial management,” he said.
“The passage of this bill will ultimately improve the ability of government to deliver direct, immediate and substantial services to the people, especially the poor, as well as strengthen government’s accountability to the people for its use of public funds. It will, likewise, establish a comprehensive legal framework on the allocation, use and accounting of public funds,” Nograles added.
Despite the best intention of the measure, Minority Leader Rep. Danilo E. Suarez of the Third District of Quezon said a reorganization of agencies is needed to address the issue of underperforming government departments.
“The 2019 deliberations of national budget will be ‘stormy.’ [For] the part of the minority, we will move for a reorganization of [underperforming] government…[agencies]. We will [also] call the attention of …Cabinet secretaries who[se performance is below] par,” Suarez said.
With the ratification of the budget-reform bill, Budget Secretary Benjamin E. Diokno said he is expecting further improvement in government spending, as the government is now ready to transition to annual cash-based budgeting from multiyear obligation budgeting, which, he said, is one of the main features of the bill.
“Moving forward, we expect further improvement in government spending as the bureaucracy shifts to annual cash-based budgeting starting fiscal year 2019,” he said.
Diokno added the annual cash-based budgeting, as opposed to multiyear obligations-based budgeting, limits incurring obligations and disbursing payments for goods, delivered and services rendered, inspected and accepted within the fiscal year.
The bill has been listed as one of the priority measures of the Legislative-Executive Development Advisory Council. The provisions of the bill shall apply to the management of revenue, expenditure, financing arrangements and assets and liabilities of national government agencies, government-owned and -controlled corporations, and local government units. The bill mandates Congress to monitor and review government performance against the requirements of appropriations and related laws, and hold government agencies accountable for their financial and nonfinancial performance.
It also empowers the President of the Philippine to approve the following: statement of fiscal policy; medium-term fiscal strategy for submission to Congress; and changes in the functional, operational and organizational structure within and among the departments of Budget and Management (DBM), of Finance and the National Economic and Development Authority, as may be necessary.
It mandates the DBM not to approve any request for release of allotments for items of appropriation covered in the negative list or modification in the allotment nor recommend the use of savings by the President until such time the noncompliant agency has submitted the reports required under the Act.
The bill allows the Commission on Audit (COA) to suspend and/or disallow any expenditure charged against augmentation using savings and any expenditure due to modification in the allotment which were made within the period succeeding the reporting period when the agency failed to comply with the reporting requirements under the act.
Likewise, the measure holds accountable public officials who fail to report on the income and funds retained at the end of a reporting period. It seeks to void all disbursements against such income or funds in subsequent reporting period when the agency failed to comply with the reporting requirements under the act. The Congress, through its appropriate oversight committee, may motu proprio or upon the request of COA or DBM compel the head of the noncompliant agency, under pain of contempt, to produce the required report or reports and to explain failure of submission of such report or reports.
Any public official or employee who shall cause the inclusion of fraudulent information in any accountability report shall be penalized with imprisonment of up to five years, or a fine not exceeding P1 million, or both, without prejudice to disallowances that may be made by the COA against expenditures related to such fraudulent information, provided that this fine is reviewed and adjusted periodically to be reasonable.
Any public official or employee who knowingly incurs any contractual commitment or authorizes any expenditure in violation of the provisions of the Act or takes part therein shall, likewise, be removed or dismissed from office, after due notice and hearing, even if no criminal charge is instituted against him or her.