Budget Secretary Amenah F. Pangandaman has assured that public projects jointly funded with bilateral and multilateral development partners will be implemented as scheduled next year, as most of them formed part of the regular 2025 budget proposal.
"So far, when I saw the GAB [general appropriations bill], there's no foreign-assisted project transferred" to unprogrammed appropriations, Pangandaman told Manila Bulletin on the sidelines of the International Conference on Women, Peace and Security (ICWPS) on Tuesday, Oct. 29.
"Hopefully, it will continue until the passage of the [budget] law," Pangandaman added. The proposed record-high P6.352-trillion spending plan for next year has already hurdled the Lower House.
Such was Pangandaman's response when asked by Manila Bulletin about recent implementation reports showing that some foreign-assisted projects are getting delayed because they are lumped into unprogrammed appropriations.
For instance, an Oct. 28 implementation status and result report of the World Bank blamed the inclusion among unprogrammed appropriations in the 2023 national budget as a cause of delay in the Department of Education's (DepEd) Teacher Effectiveness and Competencies Enhancement Project, for which the Philippines borrowed $110 million from the Washington-based multilateral lender last year.
Since these are not covered by regular budget funds, unprogrammed appropriations can only be financed by excess or new tax and non-tax revenue collections, as well as foreign loans for specific programs and projects.
In the proposed 2025 national budget, documents showed that P215.7 billion worth of foreign-assisted projects, mostly infrastructure, will be for implementation next year, of which the bigger P150.6 billion in expenditures shall come from loan proceeds, while the remaining P65.1 billion consisted of counterpart financing from the national government.
Budget documents also showed that unprogrammed appropriations would drop to P158.7 billion in 2025 from P731.4 billion in 2024, more than double the P332.8 billion in 2023.
In the case of foreign-assisted projects, Pangandaman explained that only those that were not yet green-lit by the National Economic and Development Authority (NEDA) Board chaired by President Ferdinand R. Marcos Jr. during annual budget preparations from January to March of each year had been usually included in unprogrammed appropriations.
Such was the case in the proposed 2025 budget when yet-to-be-approved foreign loan-funded projects made it to unprogrammed appropriations, but these amounts were "not so huge" and would move forward once the loans with development partners are signed, Pangandaman pointed out.
In the latest World Bank report, it downgraded the overall implementation progress of the DepEd project to "moderately satisfactory" from "satisfactory" previously.
Similarly, progress towards achieving the project's development objective of improving the quality and equity of instruction from Kindergarten to Grade 6 in the regions it supports became "moderately satisfactory" during its initial implementation stage.
"The project has met initial implementation delays as a result of procurement-related challenges and budget allocation. The project was categorized as unprogrammed appropriations in the 2023 General Appropriations Act (GAA)," the World Bank said.
"In addition, there was an issue with the issuance of the special allotment release order (SARO), as the signing of memorandum of agreement (MOA) between the Bangsamoro Autonomous Region of Muslim Mindanao's Ministry of Basic, Higher and Technical Education (BARMM-MBHTE) and the DepEd was delayed. The DepEd submitted a revised request for the SARO in July 2024, but it was issued on August 5, 2024," it added.
The World Bank said the MOA with BARMM-MBHTE already pushed through, such that "a detailed action plan to expedite implementation of project activities has been agreed " with the DepEd.
To date, $5.49 million or 4.9 percent of loan proceeds have been disbursed for this project closing in mid-June 2028.