Let’s do cash-based budget in 2020–Nograles

Published August 15, 2018, 11:30 PM

by Roel Tibay

By Ellson Quismorio

House Appropriations Committee Chairman, Davao City Rep. Karlo Nograles would rather that Congress take a stab at cash-based budgeting in 2020, and not next year.

Nograles, speaking in an interview over ANC Headstart Wednesday, said this would allow the various government agencies more time to adjust to the Duterte administration fiscal policy.

2017 GAA PLENARY/26SEP2016 At the Plenary Hall of the House of Representatives in Quezon City, Appropriations Committee Chairman Davao City Rep. Karlo Nograles gives his sponsorship speech at the first Plenary Session for the 2017 General Appropriations Act. MB PHOTO/FEDERICO CRUZ
Davao City Rep. Karlo Nograles

“It’s not yet time [to make the shift from an obligation-based budget to a cash-based budget],” the Mindanao lawmaker said.

“Maybe we can do this in 2020, but not 2019. Let the agencies first catch up with their spending,” Nograles said.

The Appropriations panel recently suspended House deliberations on the proposed 2019 national budget worth P3.757 trillion. The 2019 budget, which is cash-based
in nature, has been viewed as too restrictive compared to the obligation-based budgets of years past.

For one thing, an obligation-based budget has a longer lifespan (24 months) compared to cash-based (15 months). As such, congressmen said it’s less complicated to implement government projects under an obligation-based regime.

The 2019 budget is also replete with fund reductions among the different government agencies–something that House members have made a huge fuss over.

Nograles said that for the current administration, unlike the previous one, “underspending is not a problem.”

“The budget is 95 percent obligated; under-utilization, not underspending, is the real issue,” he noted.

It can be recalled that Department of Budget and Management (DBM) representatives during the House budget hearings last week repeatedly pointed to the poor absorptive capacity of the agencies as the reason for their slashed budgets.

Absorptive capacity refers to the rate by which an agency can utilize its fund allocation.

It was the DBM that submitted the 2019 budget to the House of Representatives last month.

Later Wednesday, Majority Floor Leader Rolando Andaya bared that they would opt for a hybrid between cash-based and obligation-based.