As budget hearings stall, Diokno still optimistic

By Bernadette D. Nicolas & Jovee Marie N. dela Cruz

KEY members of the House of Representatives served notice they are suspending hearings on the 2019 national budget, to give economic managers a chance to scuttle the cash-based budget, which they blame for huge cuts in vital sectors, but Budget Secretary Benjamin E. Diokno is still optimistic the new House leadership will support the proposed money measure.

Sought for comment on the House move to suspend the budget briefings until further notice in line with their position against the shift due to “budget cuts,” Diokno told the BusinessMirror the revolutionary shift from obligation-based budgeting to cash-based budgeting is necessary to fast-track the completion of projects.

“We’re hoping that the new House leadership will see the light and support the proposed 2019 President’s budget and his agenda of reform,” he said in a message. “If they are true allies of the President, they should embrace rather than fight his agenda of real reforms.”

However, Rep. Karlo Alexei B. Nograles of Davao City, the head of the House appropriations panel which steers budget deliberations, legislators crossed party lines because they agree “that cash-based budgeting is not feasible, impracticable, and inimical to the interests of our constituents.”

Owing to the limitations of a cash-based system, the 2019 budget is P10 billion lower in absolute terms compared to the 2018 General Appropriations Act (GAA), which reached P3.767 trillion, the lawmaker said.

“Since the House position is to revert to obligation-based budgeting, we will give time to the DBCC to make the necessary changes,” Nograles said.

Reenacted budget?

Diokno, who also chairs the interagency Development Budget Coordination Committee (DBCC), meanwhile, revealed that they are “exploring” their options, including a re-enacted 2018 budget.

Senate President Pro Tempore Ralph G. Recto pointed out, however, that while the 2018 year-end deadline for Congress to pass a new budget law is barely four-and-a-half months away, “any speculation of a reenacted budget is premature.”

In a statement, Recto prodded the Senate to “continue with its parallel hearings on the 2019 budget because only through this rigorous examination of agency budgets will we be able to discover their flaws and faults and apply the remedial measures.”

Recto recalled that the continuation of parallel Senate budget hearings simultaneous with the House of Representatives “actually give us the opportunity to discover and inquire from agencies if their proposed budget for 2019 is at the level that will allow them to fulfill their mandates.”

Still, he acknowledged “the prerogative of the House” to suspend hearings on the Palace-proposed 2019 national budget.

“We can only hope that after this pause, they [House] can fast-forward their review so that the budget will arrive in the Senate as scheduled and will not jeopardize the traditional timetable of an enacted budget by the end of the year,” Recto said over the weekend.

The Senate leader affirmed that “the 2019 budget is crucial” as it is the expenditure program post-TRAIN, adding that “this must be reflective of the promised boost in social services and infrastructure spending on which TRAIN was premised.”

Shift needed: Diokno

Diokno said it is also possible that the 2019 actual spending would still be higher than actual 2018 spending because a lot of 2017 and 2018 projects are still to be obligated and disbursed.

“The shift from obligation budget system to cash-based budget system is basic if we want projects to be implemented faster, their benefits enjoyed by beneficiaries [school- children, the sick, farmers, commuters and others] sooner, and suppliers and contractors paid earlier,” he said.

Diokno reiterated the big difference between obligations and disbursements. “Obligations are intentions; disbursements, on the other hand, mean that projects have been completed and that public goods and services have been delivered,” he added.  “In sum, there’s a monumental difference between obligation-based budgeting and cash-based budgeting.”

At the House Appropriations Committee hearing with the DBCC, lawmakers fretted over the “slashed budgets” of key agencies and noted the proposed 2019 cash-based national budget at P3.757 trillion was P10 billion “lower” than the current P3.767-trillion General Appropriations Act for 2018.

With Butch Fernandez


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