THE Department of Budget and Management (DBM) said it is eyeing full implementation of the cash-based budgeting system (CBS) for the whole government by 2025.
Budget Secretary Amenah F. Pangandaman said last Wednesday the DBM will be pushing for the “gradual implementation” of CBS “to ensure timely and efficient implementation of government programs.”
The DBM is seeking to institutionalize the shift to a cash-based budgeting system through the proposed Budget Modernization bill, one of the priority legislative measures of President Ferdinand R. Marcos Jr.
As opposed to the obligation-based budgeting system, which allows the delivery of contracts beyond the fiscal year, all appropriations under the cash-based budgeting system shall be made available for obligation and implemented only until the end of each fiscal year. Payments for obligations incurred may be settled within the year or up to an extended period of three months after the end of the validity of appropriations, according to the DBM.
“As stated by the President, the CBS will help ensure that every peso budgeted by the government will lead to the actual delivery of programs and projects, especially amid the execution of post-pandemic recovery plans, large infrastructure spending, and increased social safety nets,” Pangandaman said in a message aired during the 2022 Economic Forum by the Economic Journalists Association of the Philippines (EJAP) and San Miguel Corp. (SMC).
Address bottlenecks
THROUGH the CBS, the budget chief said they aim to, for one, address bottlenecks in obligations, which will lead to on-time implementation and disbursement of government programs and projects. Pangandaman added the CBS is expected to better planning of government agencies leading to higher utilization rates and improved public service delivery.
Executive Order 91 series of 2019 signed by then-President Rodrigo Duterte mandated the adoption of the CBS to speed up the implementation of government programs.
Proposed by the DBM in 2018, the shift to the CBS faced strong opposition from lawmakers who perceived that the move would lead to budget cuts.
The opposition to the proposed shift to the cash-based budgeting system, along with other issues on alleged budget insertions, caused the delay in the passage of the 2019 national budget, which led to the country clocking slower economic growth rates in the first and second quarters.
Rightsizing, procurement
APART from the institutionalization of the CBS, the DBM is also pushing for the proposed National Government Rightsizing program.
Pangandaman also said they will focus on enhancing the Government Integrated Financial Management Information System to improve the cash management of the Bureau of the Treasury (BTr).
She also said the DBM, together with the Department of the Finance, the BTr and the Commission on Audit, will fast-track the development of and implementation of the Budget and Treasury Management System. The latter is an “integrated, web-based and fully-automated system designed to streamline and monitor various financial transactions of government agencies.”
Likewise, the DBM, through the Government Procurement Policy Board, will spearhead the implementation of the Green Public Procurement Roadmap, which aims to integrate “green choices” in public procurement.