BEYOND BUDGET
Assalamu alaikum wa Rahmatullahi wa Barakatuh.
Last Dec. 30, 2024, President Ferdinand R. Marcos Jr. (PBBM) signed the Fiscal Year (FY) 2025 General Appropriations Act (GAA) but at the same time, used his Constitutional power to veto line items not aligned with our Medium-Term Fiscal Framework and Philippine Development Plan 2023-2028.
As you may know, the 2025 General Appropriations Bill (GAB) submitted by Congress to the President for approval and signature faced challenges as it was significantly different from the 2025 National Expenditure Program (NEP) or the President’s proposed budget. Under our democratic process, with Congress having the “power of the purse,” PBBM may only apply the power vested by our Constitution, that is to veto the whole budget or the specific provisions inconsistent with our Agenda for Prosperity.
As the President emphasized during the signing of the FY 2025 GAA, “We take our role as stewards of our taxpayers’ money seriously.” As such, “after an exhaustive and thorough review, we have directly vetoed over ₱194 billion worth of line items that are not consistent with our programmed priorities.”
Thus, I laud the President for using his veto power to ensure that our budget this year is aligned with our national development goals and was signed on time, allowing agencies to implement new and vital programs, activities, and projects, as well as build upon their existing ones.
The vetoed items include around ₱26.065 billion allocations for certain programs and projects of the Department of Public Works and Highways (DPWH) which were not consistent with the Build Better More infrastructure program — taking into account the urgency of need, implementation-readiness, and the agency’s absorptive capacity.
Also vetoed were items worth around ₱168.240 billion under the Unprogrammed Appropriations (UAs), which increased by 300 percent from the NEP. In his veto message, PBBM noted that UAs serve as standby authority to incur additional agency obligations for priority programs and projects, which should be generally within the parameters of programmed resources, subject to the existence of revenue sources that are yet to be realized.
Meanwhile, 12 special provisions (SPs) were placed under conditional implementation to ensure strict compliance with applicable laws, policies, rules, and regulations. These provisions include the Department of Social Welfare and Development’s “Ayuda sa Kapos ang Kita Program (AKAP)” and the “PAyapa at MAsaganang PamayaNAn (PAMANA)” Program.
Other SPs under conditional implementation include the “Basic Infrastructure Program;” “Support to Foreign-Assisted Projects;” the Department of Agriculture’s “Rice Competitiveness Enhancement Fund;” “Use of Excess Revenue from the Total Annual Tariff Revenue from Rice Importation;” the Natural Disaster Risk Reduction and Management Program; and the Congress of the Philippines’ “Availability of Appropriations and Cash Allocations,” among others.
Further, the President conveyed his standpoint on the implementation of certain provisions, namely the Congress of the Philippines’ “Organizational Structure of the Senate, the House of Representatives, the Senate and House Representatives Electoral Tribunals and the Commission on Appointments;” DPWH-OSEC, “Special Road Fund;” Department of Health-OSEC, “Health Facilities Enhancement Program;” and Section 79, General Provisions, “Priority in the Use of Savings.”
Notably, Section 6 of the FY 2025 GAA Veto Message requires all congressional insertions to secure a Special Allotment Release Order (SARO) before funds may be disbursed, a process called FISARO (For Issuance of SARO). The SARO will only be released once agencies meet the requirements and secure approvals from the Executive Secretary and the Office of the President. The DBM will likewise require agencies to submit revised performance targets to reflect these changes.
I am positive this process will serve as an added safeguard to the budget, ensuring that increases or new items introduced by Congress are subject to the government’s cash programming and adhere to prudent fiscal management. This ultimately ensures that the government’s spending remains aligned with its priorities and fiscal goals. I believe this process supports transparency, accountability, and the efficient use of public funds.
Aside from the provisions subject for conditional implementation in the President’s Veto Message, other items covered by FISARO are lumpsum for creation/filling of new positions; Centrally-Managed Items (CMIs) or lumpsum appropriations; Special Accounts in the General Fund (SAGF); Intelligence Fund; Increases in the Confidential Funds in the FY 2025 GAA; and Special Purpose Funds (SPFs), as applicable.
I reiterate my appreciation to PBBM for being on top of reviewing the enrolled bill. While the Congress’ version was quite different from the proposed budget that we submitted, we are grateful and relieved that the President made sure that we do not end up with a reenacted budget, and have instituted measures to ensure that the FY 2025 GAA will be used for its intended purpose.
Beyond budget, the President’s judicious use of his veto power to ensure a budget that responds to the needs of the people reflects the independence of the branches of government, with checks and balances in place. On the part of the DBM, we stand alongside the President in his desire for an efficient execution of the budget and guarantee that all funds will be utilized following the government’s strategic plans and for the benefit of all Filipinos.
(Amenah F. Pangandaman is the Secretary of the Department of Budget and Management.)