THE House of Representatives and the Executive may continue their dispute on discontinuing the obligation-based budgeting system, but the Bureau of Internal Revenue (BIR) is already preparing for a transition to the annual cash-based budgeting system.
The agency has issued a revenue memorandum circular (RMC) prescribing the guidelines for the process of early procurement for the year 2019 by government agencies, following the circular letter issued by the Interagency Task Force created under Administrative Order 25 (AO 25 IATF).
Under BIR RMC 69-2018 issued this month, the BIR requires all officials in its revenue region offices to comply with Circular Letter 2018-8 issued by the AO 25 IATF in July this year, prescribing the conduct of early procurement for fiscal year 2019 National Expenditure Program (NEP), which is seen to be implemented during October to December this year.
“The annual appropriations for 2019-onwards shall be limited to the requirements for payment of goods delivered, services rendered, and infrastructure projects completed by the end of a fiscal year. To ensure efficient implementation of programs, activities, and projects, agencies shall undertake timely procurement planning and early procurement activities,” the circular letter said.
The circular letter explains that since the national budget for 2019 will shift from the current two-year obligation-based to annual cash-based budgeting system, all government agencies are instructed to conduct early procurement planning activities, which was pointed out to ensure efficiency in the implementation of government programs and activities.
“All government entities covered by this circular shall undertake early procurement activities, from October to December 2018, upon the submission of the Fiscal Year 2019 NEP to Congress,” it added.
Included under early procurement activities are the preprocurement conference up to the post qualification of bids, and recommendation by the Bids and Awards Committee to award the contract to the winning bidder, among others.
The AO 25 IATF is chaired by the Department of Budget and Management (DBM) and cochaired by the Office of the Executive Secretary (OES), with members from the National Economic and Development Authority (Neda), the Presidential Management Staff (PMS) and Department of Finance (DOF).
The IATF was created to harmonize, unify, streamline and simplify all existing monitoring and reporting requirements and processes consistent with the Results-Based Performance Management System (RBPMS).
The administrative order was signed by former President Benigno S. Aquino III on December 2011.
Last week the DBM and the Neda insisted that the Executive will continue to push for a cash-based budget for 2019 despite a standoff with Congress.
The government is proposing a P3.757-trillion 2019 national budget, which was pointed out to be crucial for the “Build, Build, Build” program. The budget for 2018 is P3.77 trillion under a two-year obligation-based system.
The House of Representatives decided on Wednesday to continue deliberations for the 2019 national budget when Congress resumes its session next week.