Adoption of the OPIF in the Budget Proposal

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Philippine Association for Government Budget
Administration (PAGBA) Sarabia Manor Hotel,
Iloilo City April 3-5, 2015

Account Management Teams Strengthening the
Linkage Between Agency Planning, Budgeting and
Operations to Promote Quality Spending
By TERESITA M. SALUDOIC-Director
Department of Budget and Management Budget and
Management Bureau - E
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Budgeting and Financial Planning for Results
National Policy
National Budgets
Expenditure Management
Results
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President Aquino Administrations Agenda for
Empowerment

• that state or ideal in which people have free
  reign to determine their destinies (and) a
  process of meaningfully devolving power, both
  political and economic, to those historically in
  the margins and deprived of such power, from
  those sectors which have monopolized this power
  for their own benefit

Secretary Florencio B. Abadat Ateneo de Manila
University SchoolMay 7, 2013
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Public Expenditure Management (PEM)
Reform(Imperatives)

1. Restoring public trust in the democratic system
2. Dividends of good governance
3. Strengthening the constituency of reforms

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Public Expenditure Management (PEM)(Objectives)

1. Aggregate fiscal discipline or spending within
   means
2. Allocative efficiency or spending on the right
   priorities
3. Operational efficiency of spending with
   measurable results

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Development Budget Coordination Committee (DBCC)
Department of Budget and Management (DBM) -
Chair- resource allocation and management
(budget management)
Department of Finance (DOF)- revenue generation
and debt management (taxes borrowings)
National Economic and Development Authority
(NEDA)- overall economic policy (GNP, GDP)
Bangko Sentral ng Pilipinas (Resource
Institution)- monetary measures policies
(interest rates, inflation, etc.)
Office of the President (OP)- Presidential
oversight
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Major Functions of the DBCC

• Establish the level of annual government
  expenditure programs
• Determine the proper allocation of expenditure
• Allocate the amount set for each activity
• Assess the reliability of revenue estimate
• Recommend appropriate tax or other revenues
  measures and the extent and type of borrowings
• Conduct periodic review and general examination
  of costs, accomplishments and performance
  standards

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Role of DBM in Expenditure Management

• 1. Operational efficiency
• 2. Prudent fiscal management

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NG Disbursement Performance per BTr Cash
Operation ReportAs of March 31, 2011-2012(In
Million Pesos)
Source BTS Paper on AMT
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General Findings on Causes of Underspending
During First Quarter 2012

• 1. Deficient agency MCP submissions
• 2. Disconnect between the DBM programming/NCA
  release schedule and the agency-formulated MPC.
• 3. Difficulty in setting clear target outputs for
  the current budget year, given the extended
  validity of continuing appropriations/
  allotments, spilling over to the next year/from
  the previous year

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General Findings on Causes of Underspending
During First Quarter 2012 . . . . . . . . .cont.

• Unawareness of agencies, as well as the BMBs, of
  the relevance/significance of MCPs on the
  formulation of the DBCC disbursement program and
  its impact on economic growth and borrowing
  targets.
• 5. Apparent need for enhanced coordination among
  the BMBs and BTS/FPB in the finalization of MCPs
  for purposes of DBCC decision-making.

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AMT Functions

• 1. Identification and proposal of new initiatives
  to improve financial performance
• 2. Development of measures/leading indicators
  (e.g., bidding schedules) as general guide in
  achieving disbursement targets
• 3. Laying down strategies to facilitate linkages
  (internal workflow processes and top-to-bottom
  operating links) in order to attain financial
  targets

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AMT Functions . . . . . . . . . . .cont.

• 4. Institutionalization of regular (bi-monthly)
  assessments of agency financial performance
• 5. Updating of financial, non-financial, internal
  processes scorecards of departments/agencies.

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(In Million Pesos)
Source BTS Paper on AMT
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AMT-Classified Factors Affecting the
Underspending

• 1. Policy Issues
• 2. Internal processes, systems and procedures
• 3. Communication
• 4. Organization (Supervisory/manpower concerns)

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THE CHALLENGES

• How can AMTs ensure that Department disbursements
  in CY 2013 are aligned with DBCC quarterly and
  year-end targets ?
• Setting of early deadline for the submission
  of MCP (November 30, 2012 for current budget and
  January 31, 2013 for PYs continuing
  allotments, per NBC 543)
• Reforms Initiated
• For DBM AMT members to acquire better functional
  knowledge of selected major operations of
  departments
• Agency confirmation of the approved MCP prior
  to submission to DBCC
• Posting in the DBM/agency website the approved
  cash disbursement program
• How can AMTs ensure that CY 2014 Budget Proposals
  are submitted on time
• Deadline on April 15, 2013
• Restructuring of PAP
• no submission, no TBH, ( agency budget shall be
  limited to agency indicative ceiling)

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MADAMO GID NGA SALAMAT(Maraming Salamat)