Cel Flashcards
an estimation of the revenue and
expenses over a specified future period of
time and is compiled and re-evaluated on a
periodic basis.
BUDGET
is the critical exercise of allocating revenues and
borrowed funds, and management of
government expenditures.
GOVERNMENT BUDGETING
Why is Government Budgeting important?
Government budgeting is important because it
enables the government to plan and manage
its financial resources to support the
implementation of various programs and
projects that best promote the development
of the country.
What are the major processes involved in
national government budgeting?
BUDGET PREPARATION
BUDGET LEGISLATION
BUDGET EXECUTION
BUDGET ACCOUNTABILITY
This starts with Budget Call and ends with
the President’s submission of the
proposed budget to Congress.
BUDGET PREPARATION
• Headed by DBM Secretary
• Members: Secretary of Finance, NEDA Director-General, and the
Bangko Sentral Governor with the Office of the President for general
oversight.
DBCC
MEMBERS OF DBCC
DBM, DOF, NEDA, OP, BSP
WHAT ARE THE FUNCTIONS OF DBCC?
•Recommend for Presidential approval the level of the annual government expenditure
program and the ceiling of government spending for economic and social development,
national defense, general government and debt service;
•Recommend to the President the proper allocation of expenditures for each development
activity between current operating expenditures and capital outlay; and
•Recommend to the President the amount set to be allocated for capital outlay under each
development activity for various capital or infrastructure projects.
•The assessment of the reliability of revenue estimates;
• The recommendations of appropriate tax or other revenue measures and the extent and
type of the borrowings; and
•The conduct of periodic review and general examination of costs, accomplishments and
performance standards applied in undertaking development projects
provides the over-all macro-economic
assumptions with which budgetary levels are to be
determined.
National Economic and Development Authority (NEDA)
It is the Bureau of the
Treasury, the Bureau of Internal Revenue and the Bureau
of Customs help the DBCC in determining the sources of financing
DEPARTMENT OF FINANCE (DOF)
The DBCC determines the overall economic targets,
expenditure levels, the revenue projection, deficit levels and
the financing plan. It submits them to the President and the
Cabinet for approval
under budget preparation
Once these are approved, the DBM issues the _______ This requires agencies to prepare their budgets in
accordance with the said guidelines, macro-economic
assumptions, and ceilings. The DBM spells out guidelines,
procedures, and timetables.
BUDGET CALL
At the beginning of the Budget Preparation year, the Department of
Budget and Management (DBM) issues the National Budget Call
to all agencies (including State Universities and Colleges) and a
separate Corporate Budget Call to all GOCCs and GFIs
The _________contains budget parameters as set beforehand
by the Development Budget Coordination Committee and policy
guidelines and procedures in the preparation and submission
of agency budget proposals.
BUDGET CALL
A new feature in budget preparations which seeks to increase
citizen participation in the budget process, departments and
agencies are tasked to partner with civil society organizations
(CSOs) and other citizen-stakeholders as they prepare their
agency budget proposals.
This new process, which was piloted in the preparation of the 2012
National Budget, is now being expanded towards
institutionalization.
STAKEHOLDER ENGAGEMENT
The Aquino government, through the Cabinet Cluster of Human
Development and Poverty Reduction, has identified 300 to 400 of
the poorest municipalities and engaged these in crafting
community-level poverty reduction and empowerment plans.
This
initial salvo of “bottom-up” budgeting focused on rural development
programs and the conditional cash transfer program, and thus
involve DA, DAR, DENR, DSWD, DepEd and DOH. These
agencies then include the community plans in their proposed
budgets.
BOTTOM-UP BUDGETING
These are conducted after departments and
agencies submit their Agency Budget Proposals to
the DBM. Here agencies defend their proposed
budgets before a technical panel of DBM, based on
performance indicators on output targets and
absorptive capacity. DBM Bureaus then review the
agency proposals and prepare recommendation.
TECHNICAL BUDGET HEARINGS
The recommendations are presented before an Executive
Review Board which is composed of the DBM Secretary
and senior officials.
Deliberations here entail a careful prioritization of programs
and corresponding support, vis-à-vis the priority agenda of
the National Government
Implementation issues are also discussed and resolve
EXECUTIVE REVIEW
DBM then consolidates the recommended agency budgets and
recommendations into a National Expenditure Program and a
Budget of Expenditures and Sources of Financing (BESF)
As part of the consolidating process, the deliberations by the
DBCC will determine the agency and sectoral allocation of the
approved total expenditure ceiling, in line with the macroeconomic
and fiscal program. Heads of major departments are invited to this
meeting
CONSOLIDATION, VALIDATION AND
CONFIRMATION
The proposed budget is presented by the DBM,
together with the DBCC, to the President and Cabinet
for further refinements or reprioritization.
After the President and Cabinet approved the
proposed National Expenditure Plan, the DBM prepares
and finalizes the budget documentations to be
submitted to Congress
PRESENTATION TO PRESIDENT AND CABINET
The Budget preparation phase ends with the
submission of the proposed National Budget – the
“President’s Budget” - to Congress
The “President’s Budget” consists of the following
documents, which helps legislators analyze the
contents of the proposed budget:
THE PRESIDENT’S BUDGET
The President submits to Congress the National
Expenditure Program (NEP), the Budget of
Expenditures and Sources of Financing (BESF), and
the President’s Budget Message.
The BESF is the document which reflects the annual
budget and the estimates and sources of
financing. The document is presented by the
Executive branch to the Legislative branch
BUDGET LEGISLATION
Pertains to the whole range of legislative
action on the budget, leading to enactment of a
General Appropriations Law of the year
BUDGET AUTHORIZED PHASE
As in the House Process, the Senate conducts
its own committee hearings and plenary
deliberations on the GAB. Budget
deliberations in the Senate formally start after
the House of Representatives transmits the
GAB
SENATE DELIBERATIONS
Once both Houses of Congress have finished their
deliberations, they will each constitute a panel to the
Bicameral Conference Committee. This committee
will then discuss and harmonize the conflicting
provisions of the House and Senate Versions of the
GAB
BICAMERAL DELIBERATIONS
The Harmonized or “Bicam” Version is then submitted
to both Houses, which will then vote to ratify the final
GAB for submission to the President. Once
submitted to the President for his approval, the GAB
is considered enrolled
RATIFICATION AND ENROLLMENT
The President and DBM then review the GAB and
prepare a Veto Message, where budget items
subjected to direct veto or conditional implementation
are identified, and where general observations are
made.
Under the Constitution, the GAB is the only legislative
measure where the President can impose a line-veto
VETO MESSAGE
When the GAA is not enacted before the fiscal
year starts, the previous year’s GAA is
automatically reenacted. Funding for
programs or projects that have already been
terminated is realigned for other expenditure
ENACTMENT
The Committee Affairs Department’s activities during
budget legislation are:
- Committee Budget Hearings
- Printing of General Appropriations Bill (GAB) on 1st reading
- Executive Meeting of the Committee
the Bills and Index Division. - Sponsorship and Plenary Deliberations
- Approval on 2nd Reading of the GAB
- Amendments, Finalization & Printing of the GAB for 3rd Reading
- Approval of the GAB on 3rd Reading
- Transmittal on the 3rd Reading Copy of the GAB to the Philippine
Senate - Bicameral Conference Committee
- Approval of the Bicam Report
- Finalization and Printing of the Enrolled Copy of the GAB
- Signing of the Enrolled Copy of the GAB
Standing Committee are responsible for
conducting budget hearings. During these hearings, macroeconomic
assumptions/ plans are presented during the Committee budget hearings on
a department wide level. Sub-Committees are also responsible for conducting
these budget hearings.
Committee Budget Hearings
a National
Expenditure Program is formulated, and a copy of the GAB on 1st reading is
printed by the Committee Technical Staff, based on the National Expenditure
Program. The GAB is filed in the plenary session for the 1st reading.
Printing of General Appropriations Bill (GAB) on 1st reading
The Committee meets in
executive session to discuss and approve the proposed committee
amendments to the GAB. Committee Reports are prepared and filed to
the Bills and Index Division.
Executive Meeting of the Committee
General principles and
macroeconomic assumptions are sponsored and debated in the
plenary session. Deliberations on the budgets of each department,
agency, office, including Government Owned and Controlled Corporations
Sponsorship and Plenary Deliberations
Turno en contra speeches are
delivered on the floor. The turno en contra is a legislative tradition allowing
opponents of the bill an opportunity to explain at length their position, in
the same manner that a bill’s sponsor delivers a sponsorship speech. After
the Turno en Contra, the Philippine House Members vote on the approval of the
GAB on the 2nd Reading
Approval on 2nd Reading of the GAB
inclusion of possible amendments to the GAB for the 3rd Reading are submitted
to the floor. Amendments are approved for the inclusion in the proposed copy of
the GAB on the 3rd Reading, which is subsequently printed for deliberation.
Amendments, Finalization & Printing of the GAB for 3rd Reading
The GAB is distributed to the
Philippine House Members who votes on the approval of the bill on the
3rd Reading. The GAB is then approved on 3rd Reading.
Approval of the GAB on 3rd Reading
the GAB, as approved on 3rd Reading, is transmitted to the
Senate for consideration in a similar manner as deliberated upon by the
House.
Transmittal on the 3rd Reading Copy of the GAB to the Philippine
Senate
The conferees or representatives
from both the Philippine House and Senate convene as a Conference
Committee in order to settle and reconcile differing provisions of each chamber’s version of the bill
Bicameral Conference Committee
the Conference Committee Report
is ratified by each chamber
Approval of the Bicam Report
all
amendments as approved in the Committee Report are incorporated into
the enrolled copy of the GAB. The enrolled copy is finally printed.
Finalization and Printing of the Enrolled Copy of the GAB
the enrolled copy of the
GAB is forwarded to the President for signing. Veto powers of the
Presidents are exercised in the enactment of the GAB. The sign
appropriations bill is finally enacted into a law which is termed as the general appropriations act
Signing of the Enrolled Copy of the GAB
is the process by which the financial
resources made available to an agency are directed
and controlled toward achieving the purposes and
objectives for which budgets were approved. The
process involves compliance
BUDGET EXECUTION
After the government enacts the budget, there is an
ongoing role for civil society organizations (CSOs) in
analyzing and assessing how funds are actually
spent to implement the policies, programs, and
projects outlined in the budget.
BUDGET EXECUTION
Issuance of Guidelines by DBM
- Bidding Process
BUDGET EXECUTION PROCESS
Overall physical (targeted outputs) and financial
(estimated obligations/expenditures) plan of the
agency consistent with their approved budget level for
the year, broken down by quarters.
Physical and Financial Plan (PFP)
Monthly disbursement requirements of the
agency which is the basis for issuance of Notice
of Cash Allocation (NCA), Cash Disbursement
Ceiling and other disbursement authorities.
Monthly Cash Program
Reflects the estimated income for the year by
source, as contained under the Budget of
Expenditures and Sources of Financing of the
given year.
Estimate of Monthly Income
Reflects the level of obligations/ expenditures
charged against prior years’ budget, for which
goods/ services/ projects are not yet delivered/
rendered/ completed and accepted as of end of
the preceding year.
BUDGET EXECUTION PROCESS
15
List of Not Yet Due and Demandable
Obligations
Allotments, which an agency is authorized to enter into
an obligation, are released by DBM or individually.
Allotment Release
is an authorization issued by the Department
of Budget and Management (DBM) to an IU (Implement
Unit) – through the ABM or SARO which allows the
latter to incur obligation for specified amounts contained in a legislative appropriation
ALLOTMENT
is a disaggregation of the agency
budget showing the items to be issued SARO for those under
needing clearance as well as the amount to be released
comprehensively for those under not needing clearances.
Agency Budget Matrix (ABM)
is a specific
authority issued to identified IU to incur obligations not exceeding a
given amount during a specified period for the purpose indicated. It
shall cover expenditures, the release of which is subject to
compliance with specific laws or regulations or by competent authority
Special Allotment Release Order (SARO)
In implementing programs, activities and projects,
agencies incur liabilities on behalf of the government
Incurring Obligations
Modified Disbursement Scheme is mostly used, where
disbursement agencies chargeable against the treasury
are made through Land Bank of the Philippines
DISBURSEMENT
Local Government Units
Limitations on Disbursement
Total disbursement shall not exceed 50% of the
unallocated estimated revenue accruing to such fund
in additional to actual collections
• No advance payments shall be made unless goods
have been delivered or services rendered
No cash advances shall be made to any local official
or employee unless made in accordance with
Commission on Audit and regulations
• No appropriations shall be transferred from one item
to another
• Use of savings is allowed from other items to augment
any items in the budget provided that it is within the same expense class
• final phase of the budget process
• this is when the agencies report their actual physical
and financial performance.
• assessment of the physical achievements of an
agency is aided by performance indicators.
BUDGET ACCOUNTABILITY
UNDER BUDGET ACCOUNTABILITY
PERFORMANCE TARGET
BUDGET ACCOUNTABILITY REPORTS (BARs)
PUBLIC DISCLOSURE
CITIZEN ENGAGEMENT
PERFORMANCE REVIEW
MID-YEAR AND YEAR-END REPORTS
COA examines how agencies use the funds
given to them from national budget.
DBM uses the COAs audit reports in confirming
that the budget and performance of agencies, all
expenses have been disbursed in accordance
with accounting regulations, and issues
regarding on the usage of fund.
AUDIT
The Development Budget Coordination
Committee will publish the national government
budgeting and performance of the programs and
projects.
MID-YEAR AND YEAR-END REPORTS
DBM
Financial and
Physical
Performance of
agencies
TARGET
PERFORMANCE REVIEW
Through Civil Society Organization, the citizen
will help safeguarding the performance of
agencies on how they use the public budget and
the way they deliver their services to people
CITIZEN ENGAGEMENT
Transparency Seal
(website)
Important information
about agencies budget
For public to see the
situation and how their
budgets executed
PUBLIC DISCLOSURE
Agencies
Financial
Accountability
Report
DBM-quality physical reports of operation
COA
BUDGET ACCOUNTABILITY REPORTS (BARs)
BUDGET- Set target that agencies should do
Performance informed budget-new approach for more responsive transparent and accountable public expenditure management system
GAA: targeted outcome, output and performance indicator
PERFORMANCE TARGETS
The role of the private sector and the participation of non-governmental, community-based, or sectoral organizations are recognized in the 1987
Philippine Constitution:
1987 PHILIPPINE
CONSTITUTION
The State recognizes the
indispensable role of the private sector, encourages private
enterprise, and provides incentives to needed investments.
Article II, Section 20
The State shall encourage non-
governmental, community-based, or sectoral organizations
that promote the welfare of the nation.
Article II, Section 23
Local
government units shall promote the establishment and operation of people’s and
non-governmental organizations to become active partners in the pursuit of local
autonomy.
Section 34. Role of People’s and Non-governmental Organizations.
Local
government units shall promote the establishment and operation of people’s and
non-governmental organizations to become active partners in the pursuit of local
autonomy.
Section 34. Role of People’s and Non-governmental Organizations.
Local government units may enter into joint ventures and such other cooperative
arrangements with people’s and non-governmental organizations to engage in the
delivery of certain basic services, capability-building and livelihood projects, and to
develop local enterprises designed to improve productivity and income, diversity
agriculture, spur rural industrialization, promote ecological balance, and enhance the
economic and social well-being of the people.
Section 35. Linkages with People’s and Non-governmental Organizations.
A local government unit may, through its local chief
executive and with the concurrence of the Sanggunian concerned,
provide assistance, financial or otherwise, to such people’s and non-
governmental organizations for economic, socially-oriented,
environmental, or cultural projects to be implemented within its
territorial jurisdiction.
Section 36. Assistance to People’s and Non-governmental
Organizations.
A local government unit may, through its local chief
executive and with the concurrence of the Sanggunian concerned,
provide assistance, financial or otherwise, to such people’s and non-
governmental organizations for economic, socially-oriented,
environmental, or cultural projects to be implemented within its
territorial jurisdiction.
Section 36. Assistance to People’s and Non-governmental
Organizations.
Local treasurers, accountants, budget officers, and
other accountable officers shall, within thirty (30) days from the end
of the fiscal year, post in at least three (3) publicly accessible and
conspicuous places in the local government unit a summary of all
revenues collected, and funds received including the appropriations
and disbursements of such funds during the preceding fiscal year.
Section 352. Posting of the Summary of Income and
Expenditures
REPUBLIC ACT NO. 3019
ANTI-GRAFT AND CORRUPT PRACTICES ACT
There are several laws that provide for transparency and accountability in Governance.
Republic Act No. 3019 or the Anti-Graft and Corrupt Practices Act outlines actions that
constitute graft and corrupt practices for individuals in public office or for private individuals
doing business with the government. The law also requires government officials to make their
statement of assets and liabilities available to the public.
It is the policy of the Philippine
Government, in line with the principle that a public office is a public
trust, to repress certain acts of public officers and private persons
alike which constitute graft or corrupt practices or which may lead
thereto.
ANTI-GRAFT AND CORRUPT PRACTICES ACT
Section 1. Statement of policy.
How do citizens participate in the local councils?
Section 41. Manner of Election.
(a) The governor, vice-governor, city mayor, city vice-mayor,
municipal mayor, municipal vice-mayor, and punong barangay shall
be elected at large in their respective units by the qualified voters
therein. However, the sangguniang kabataan chairman for each
barangay shall be elected by the registered voters of the
katipunan ng kabataan, as provided in this Code
(b) The regular members of the sangguniang panlalawigan,
sangguniang panlungsod, and sangguniang bayan shall be elected
by district, as may be provided for by law. Sangguniang barangay
members shall be elected at large. The presidents of the leagues of
sanggunian members of component cities and municipalities shall
serve as ex officio members of the sangguniang panlalawigan
concerned. The presidents of the “liga ng mga barangay and the
pederasyon ng mga sangguniang kabataan” elected by their
respective chapters, as provided in this Code, shall serve as ex
officio members of the sangguniang panlalawigan, sangguniang
panlungsod, and sangguniang bayan.
(c) In addition thereto, there shall be one (1) sectoral
representative from the women, one (1) from the workers,
and one (1) from any of the following sectors: the urban
poor, indigenous cultural communities, disabled persons,
or any other sector as may be determined by the
sanggunian concerned within ninety (90) days prior to the
holding of the next local elections as may be provided for
by law. The COMELEC shall promulgate the rules and
regulations to effectively provide for the election of such
sectoral representatives.
Can ordinary citizens take a look at what’s happenin
The Local Government Code of 1991 provides for the inclusion of
two representatives from non-government organizations that are
represented in the local development council to be included in the
Local Prequalification, Bids and Awards Committee (Local PBAC).
This committee is responsible for the conduct of prequalification of
contractors, bidding, evaluation of bids, and the recommendation of
awards concerning local infrastructure projects (“Local Government
Code,” 1991).
However, the Local Government Code was amended by
the Government Procurement Reform Act. The Local
PBAC was replaced by the Bids and Awards
Committee (BAC) as the main committee responsible
for procurement and bidding.
The procurement law requires a representative of the
Commission on Audit and at least two (2) observers
to sit in the procurement proceedings. At least one
observer should represent a duly recognized private
group in a sector or discipline relevant to the
procurement at hand.
Another observer should represent non-government
organizations (Government Procurement Policy Board,
2009b).
AN ACT PROVIDING FOR THE MODERNIZATION,
STANDARDIZATION AND REGULATION OF THE
PROCUREMENT ACTIVITIES OF THE GOVERNMENT
AND FOR OTHER PURPOSES
REPUBLIC ACT NO. 9184-
REPUBLIC ACT NO. 9184
AN ACT PROVIDING FOR THE MODERNIZATION,
STANDARDIZATION AND REGULATION OF THE
PROCUREMENT ACTIVITIES OF THE GOVERNMENT
AND FOR OTHER PURPOSES
SECTION 1. Short Title. – This Act shall be known as the
“Government Procurement Reform Act.”
SEC. 2. Declaration of Policy. – It is the declared policy
of the State to promote the ideals of good governance in
all its branches, departments, agencies, subdivisions,
and instrumentalities, including government-owned
and/or -controlled corporations, and local government
units.
SEC. 3. Governing Principles on Government
Procurement. – All procurement of the national
government, its departments, bureaus, offices and
agencies, including state universities and colleges,
government-owned and/or -controlled corporations,
government financial institutions and local government
units, shall, in all cases, be governed by these principles:
(a) Transparency in the procurement process and in
the implementation of procurement contracts.
(b) Competitiveness by extending equal opportunity to
enable private contracting parties who are eligible
and qualified to participate in public bidding.
(c) Streamlined procurement process that will
uniformly apply to all government procurement. The
procurement process shall be simple and made
adaptable to advances in modern technology in order
to ensure an effective and efficient method.
(d) System of accountability where both the public officials
directly or indirectly involved in the procurement process as well
as in the implementation of procurement contracts and the private
parties that deal with the government are, when warranted by
circumstances, investigated and held liable for their actions
relative thereto.
(e) Public monitoring of the procurement process and the
implementation of awarded contracts with the end in view of
guaranteeing that these contracts are awarded pursuant to the
provisions of this Act and its implementing rules and regulations,
and that all these contracts are performed strictly according to
specifications.
SEC. 4. Scope and Application. – This Act shall apply
to the Procurement of Infrastructure Projects, Goods,
and Consulting Services, regardless of source of funds,
whether local or foreign, by all branches and
instrumentalities of government, its departments, offices
and agencies, including government-owned and/or -
controlled corporations and local government units,
subject to the provisions of Commonwealth Act No. 138.
Any treaty or international or executive agreement
affecting the subject matter of this Act to which the
Philippine government is a signatory shall be observed.
SEC. 7. Procurement Planning and Budgeting
Linkage. – All procurement should be within the
approved budget of the Procuring Entity and should
be meticulously and judiciously planned by the
Procuring Entity concerned. Consistent with government
fiscal discipline measures, only those considered crucial
to the efficient discharge of governmental functions shall
be included in the Annual Procurement Plan to be
specified in the IRR.
IRR – refer to the implementing rules and regulations to be promulgated in accordance with
Section 75 this Act.
How do I know where the money went?
Non-government organizations and peoples’ organizations can
conduct an independent expenditure tracking and project monitoring
in their localities.
Procuring entities of the government are required to
submit the Notice of Award to the Philippine Government
Electronic Procurement System (PhilGEPS) under the
Government Procurement Reform Act (GPRA) of 2003 or Republic Act No. 9184.
PhilGEPS publishes all Notice of Awards in their website –
https://philgeps.gov.ph/
A series of actions or steps taken in order to achieve a particular end
Process
The President submits to Congress the National
Expenditure Program (NEP), the Budget of
Expenditures and Sources of Financing (BESF), and the President’s Budget Message.
The BESF is the document which reflects the annual budget and the estimates and sources of
financing. The document is presented by the
Executive branch to the Legislative branch
BUDGET LEGISLATION