2019News

DBM doubles down on cash-based budget reforms

By Karl Angelo N. Vidal, January 23 2019; Business World

https://www.bworldonline.com/dbm-doubles-down-on-cash-based-budget-reforms/

Image Credit to Philippine Star

THE Department of Budget and Management (DBM) held firm on the need for reforms like cash-based budgeting, which proved contentious in the run-up to the preparation of the delayed 2019 national budget.

In a briefing on Wednesday, Budget Secretary Benjamin E. Diokno said the department continued to introduce various budget and procurement reforms in 2018 as part of an agenda introduced at the start of the Duterte administration.

He added that the cash-based budget is the “logical solution” to all the budget reforms the DBM previously implemented.

With the new annual cash-based budgeting scheme, inspection, verification, actual payment and delivery of goods and services must come within the fiscal year the budget was proposed for, providing an incentive for on-time implementation of state programs and projects.

“With due consideration to logistics, payments will be accepted and extended up to three months of the following year under a new system… called extended payment period,” the DBM said in a statement.

The 2019 budget was not ratified by both chambers before the end of 2018, which automatically reenacts the 2018 budget — meaning no new projects or programs can be funded.

The budget was delayed over criticism of the shift to a cash-based appropriations scheme from a two-year obligation-based system, as well as alleged illegal “insertions” that favored certain districts and families.

To complement the shift to a cash-based system, the DBM said it continued to enhance the procurement process as agencies continue to cite procurement as a major cause of delay in the implementation of projects and programs.

On Monday, Mr. Diokno said that contracts for ongoing projects, particularly those that accomplished early procurement activities last year, will be awarded under the reenacted budget.

Aside from the budget reforms, the department also touted its initiatives to push for greener, more sustainable and livable cities by introducing the Assistance to Cities Program.

Under the program, a P2.6-billion fund was allocated to fund the development of public and open spaces such as parks and waterfronts, which will benefit 146 cities across the country.

By the end of 2018, five local government units received their fund allocation.

“We will continue to fulfill our mandate of promoting the sound, efficient and effective management and utilization of government resources, while introducing game-changing reforms that will improve the landscape of public sector reforms in the years to come,” Mr. Diokno said. — Karl Angelo N. Vidal

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