DBM says nothing irregular with reserve appropriations
HOUSE deputy speaker Ralph Recto yesterday described as “lump sum” the Marcos administration’s “unprogrammed funds” under the proposed national budget for 2023 and urged budget officials to itemize the appropriations to ensure transparency.
Recto, who first raised the issue last Friday, said that because of the unprogrammed appropriations, the total proposed national budget for 2023 is actually P5.856 trillion and not P5.268 trillion as announced by the Department of Budget and Management (DBM).
The former senator said that while he is not opposing the use of unprogrammed appropriations in the annual budgeting process, it would be best for the Executive department, through the DBM, to provide Congress with a detailed explanation on how it intends to spend the P588.1 billion, which is the equivalent of 16 percent of the total programmed new appropriations in the 2023 proposed budget.
“P580 billion is a huge amount. And if you take a look, there are no details. It’s just one-liner. It’s a lump-sum appropriations,” Recto told ANC’s “Headstart.” “I’m not against it. All I’m saying is, let’s provide more details. What I’m asking for is a more detailed explanation. Where is this money going to be spent? “
Recto noted that the total budget that the Executive wants under unprogrammed appropriations for 2023 is more than double than this year’s P251.7 billion.
While unprogrammed appropriations are supposed to be standby appropriations that can only be funded when the government collects enough revenues during the fiscal year, he said the funds could still be disbursed even if revenues are low.
The House leader said this is why it is important “to do line items so that we can implement the budget as effectively, as efficiently, as economically as possible.”
‘NO IRREGULARITIES’
In a statement, the DBM yesterday stood by its position that there was nothing irregular with the allocation of unprogrammed funds under the 2023 NEP and said it is ready to defend the proposed budget before lawmakers.
“Details of these unprogrammed appropriations are available for public and congress scrutiny,” the DBM said, adding that the breakdown of the standby funds are as follows: support for infrastructure projects and social programs, inclusive of P22 billion for procurement of vaccines, P149.6 billion; Armed Forces of the Philippines Modernization Program, P5 billion; budgetary support to government-owned and/or controlled corporations, P20.6 billion; support to foreign-assisted projects, P380 billion; risk management program, P1 billion; payment of arrears of the Land Transportation Office’s information technology service, P2 billion; refund of the service development fee for the right to develop the Nampeidai Property in Tokyo, Japan, P210.5 million; Bangko Sentral ng Pilipinas equity infusion, P10 billion; public health emergency benefits and allowances for health and non-health care workers, P18.9 billion; and prior years’ local government unit shares, P14 million.
It said that in the 2023 NEP, the percentage share of the unprogrammed appropriations is 11.2 percent to total obligations budget.
“However, this already includes the estimated P378.2 billion for loan proceeds requirements of the Department of Transportation (DOTr). Hence, the DBM contends that if there is going to be an analysis on whether it exceeded the ideal percentage of unprogrammed appropriations against the national budget, it should be based on the P200 billion unprogrammed appropriation, and not with the P378.2 billion unprogrammed appropriation corresponding to loan proceeds of DOTr,” the DBM said.
“Thus, should this be removed, only approximately P200 billion, or four percent, is considered unprogrammed, which will be triggered for release only upon the generation of additional revenues,” it added.
The DBM said the approach it has adopted is consistent with what occurred in 2022 when, subject to the collective wisdom of the legislature, all loan proceeds under the DOTr were transferred to the unprogrammed appropriation, due to their history of low absorptive capacity insofar as loan proceeds is concerned.
Unprogrammed appropriations are standby appropriations, and as such it provides appropriations cover for some unexpected expenses, additional support for infrastructure projects and social programs, and support to foreign-assisted projects, among others.
“In the past, there were certain instances when we did not have unprogrammed appropriation. This is due to the logic that when budget is effectively increasing, there should not be an unprogrammed appropriation. But in our country where we have calamities we do not expect or activities we do not even anticipate but necessitates us to provide services to our people, the unprogrammed appropriations is an available resource cover that will trigger additional amounts for the national government,” the DBM said.
“In light of all these, we subject ourselves to the collective wisdom of the honorable members of congress to scrutinize the budget and make adjustments as appropriate, as a result of the technical budget hearings and debates,” it also said.
Recto and fellow lawmakers from both the majority and minority blocs are particularly questioning the “Support for the Infrastructure Projects and Social Programs” (SIPSP) worth P149.7 billion and “Support to Foreign Assisted Projects” worth P380 billion that are classified under unprogrammed appropriations.
Rep. France Castro (PL, ACT) earlier said the SIPSP was introduced into the budget books during the time of then president and now Pampanga Rep. Gloria Macapagal-Arroyo “but insiders are saying that SIPSP programs will be funded through clinched loans after the General Appropriations Act (GAA) is passed so that it could not be scrutinized by Congress, and it is said that this have been the usual practice for years.”
Castro, who is a member of the militant Makabayan bloc, said the hundreds of billions of items were placed under unprogrammed appropriations to hide it from Congress and public scrutiny.
Deputy speaker Isidro Ungab, for his part, has called on DBM Secretary Amenah Pangandaman to clarify whether the unprogrammed funds are part of the “appropriations” in the Constitution, saying he considers these as part of President Marcos’ proposal under the National Expenditure Program (NEP) “even if these are deemed as standby appropriations, not backed-up by revenues at the time the NEP was submitted by the President to Congress.” — With Angela Celis
