Solons stand firm vs ‘cash-based’ budgeting

Published August 9, 2018, 5:41 PM

by AJ Siytangco

By Charissa Luci-Atienza 

The Duterte administration should revert to “obligation-based” budgeting to avoid jeopardizing the delivery of basic services, the House of Representatives said Thursday.

The administration has submitted to Congress a “cash-based” P3.757-trillion national budget for 2019.

Davao City Rep. Karlo Nograles (Federico Cruz / File | Manila Bulletin)
Davao City Rep. Karlo Nograles
(Federico Cruz / File | Manila Bulletin)

At Thursday’s House Committee on Appropriations’ deliberation of the Department of Public Works and Highways (DPWH) budget for 2019, Davao City Rep. Karlo Alexei Nograles said the Lower Chamber rejected the cash-based budget due to its impact on health, education, and infrastructure.

“We are not going to support the cash-based budget,” he told DPWH Secretary Mark Villar whose agency’s budget was cut by 15 percent for 2019.

Villar attributed the P95.2 billion reduction in the DPWH budget to the cash-based budgeting system. “It is disbursement-based budget, not an obligation-based budget,” he said, citing that they already made necessary adjustments in their proposed budget in anticipation of the cash-based budgeting system.

Asked by Zamboanga City Rep. Celso Lobregat how the DPWH can continue with the “Build, Build, Build” program when their capital outlay was reduced by more than P90 billion, Villar said, “We are adjusting to this new policy. It is the mandate of this department that if they tell us to disburse in one year, we have to adjust our assumptions based on that.”

The DPWH proposes a total of P544.521 billion for 2019, which is 14.63 percent lower than the P637.864 billion budget this year.

During the budget deliberation, Albay Rep. EdcelLagman called on his colleagues to be “united” in supporting a “realistic” budget of the DPWH to help the Duterte administration pursue its “Build, Build, Build” agenda.

“We must restore the cuts in the DPWH submittal made by DBM. We must not only restore the excised allocations but must augment the DPWH’s budget once found to be justified and imperative,” he said, noting that the DPWH is one of the major casualties of the administration’s“budgetary calisthenics”

He expressed concern that the reduction includes a drastic slash on locally funded projects. “We appreciate the announcement of the new leadership of the House that no district shall be punished with a zero infrastructure allocation. But how can this be completely pursued if the budget of the DPWH is not adequate even as the lost infrastructure projects this year because of the zero allocations cannot be offset by additional funding next year if the proposed budget of the DPWH is frozen at its present decimated level,” Lagman said.

In a separate interview, Nograles disclosed that the House “unanimously” agreed to withdraw House Bill 7302 or the Budget Reform Bill they passed on March 20, 2018 that would call for cash-based budgeting.

The House leader showed the draft copy of the two-page resolution to the reporters, which is being signed by the House members and set to be filed on Monday.

The resolution, authored by Nograles, Majority Floor Leader and Camarines Sur Rep. Rolando Andaya Jr., and Albay Rep. Joey Salceda, requests the Senate to return HB 7302 “in order for the House of Representatives to introduce further perfecting amendments thereto.”

The resolution has the support of Speaker Gloria Macapagal Arroyo, Nograles noted. HB 7302 is titled “An Act to Reform the Budget Process by Enforcing Greater Accountability in Public Financial Management (PFM), Promoting Fiscal Sustainability, Strengthening Congress’s Power of the Purse, Instituting an Integrated PFM System and Increasing Budget Transparency and Participation” The engrossed copy of HB 7302 was transmitted to the Senate on March 22, 2018.

Nograles said that if the Budget Reform bill will be passed, it would result in cash-based budgeting system.

“Hindi naipaliwanagnaitopalaangmagiging implication.Angbentana idea saamin ay mapapabilisang implementation at turn over ng projects at mapapabilisang delivery ngserbisyo.  Never nana-discuss na may mga slashes, which is opposite sa Build, Build, Build program (The implication was not explained and all that was discussed was it will hasten implementation and turnover of projects, and delivery of basic services. Budget cuts were never discussed, which is the opposite of Build, Build, Build),” he told reporters.

He noted that some House members opined that the cash-based budgeting is “illegal” since the Budget Reform bill has yet to be passed and it is not yet a policy.

“We will throw the problem back to the DBM,” he said, citing that the House is inching toward amending the proposed 2019 national budget to ensure the swift delivery of basic services and continuity in the implementation of various vital projects nationwide.