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Account Management Teams:Account Management Teams: Strengthening the Linkage Strengthening the Linkage Between Agency Planning, Between Agency Planning,

Budgeting and Operations to Budgeting and Operations to Promote Quality SpendingPromote Quality Spending

ByBy

TERESITA M. SALUDTERESITA M. SALUDOIC-DirectorOIC-Director

Department of Budget and ManagementDepartment of Budget and ManagementBudget and Management Bureau - EBudget and Management Bureau - E

Philippine Association for Government Budget Administration Philippine Association for Government Budget Administration (PAGBA)(PAGBA)

Sarabia Manor Hotel, Iloilo CitySarabia Manor Hotel, Iloilo CityApril 3-5, 2015April 3-5, 2015

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National PolicyNational Policy

Budgeting and Financial Planning for Budgeting and Financial Planning for ResultsResults

National BudgetsNational Budgets

Expenditure ManagementExpenditure Management

ResultsResults

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“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. AbadSecretary Florencio B. Abadat Ateneo de Manila University Schoolat Ateneo de Manila University School

May 7, 2013May 7, 2013

President Aquino Administration’s Agenda for President Aquino Administration’s Agenda for EmpowermentEmpowerment

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1. Restoring public trust in the democratic system

2. Dividends of good governance

3. Strengthening the constituency of reforms

Public Expenditure Management (PEM) Public Expenditure Management (PEM) ReformReform(Imperatives)(Imperatives)

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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

Public Expenditure Management Public Expenditure Management (PEM)(PEM)(Objectives)(Objectives)

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Development Budget Coordination Development Budget Coordination Committee (DBCC)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 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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1. Operational efficiency

2. Prudent fiscal management

Role of DBM in Expenditure Role of DBM in Expenditure ManagementManagement

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NG Disbursement Performance per BTr Cash Operation NG Disbursement Performance per BTr Cash Operation ReportReportAs of March 31, 2011-2012As of March 31, 2011-2012(In Million Pesos)(In Million Pesos) INCREASE/(DECREASE)

EXCESS/ PercentACTUAL (SHORTFALL) Change

REVENUES 323,078 357,780 360,974 3,194 37,896 11.7

DISBURSEMENTS 349,275 440,589 394,883 (45,706) 45,608 13.1

Non-NCA Based(incl. PY Checks) 137,936 160,323 150,238 (10,085) 12,302 8.9

NCA -Based 211,339 280,266 244,645 (35,621) 33,306 15.8 CY 191,655 258,508 232,511 (25,997) 40,856 21.3 PY A/P 19,684 21,758 12,134 (9,624) (7,550) (38.4)

SURPLUS/(DEFICIT) (26,197) (82,809) (33,909) 48,900 (7,712) 29.4

2011PARTICULARS

2012

AmountsPROGRAM ACTUAL

Source: BTS Paper on AMTSource: BTS Paper on AMT

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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

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

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4. 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.

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

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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;

AMT FunctionsAMT Functions

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4. Institutionalization of regular (bi-monthly) assessments of agency financial performance;

5. Updating of financial, non-financial, internal processes scorecards of departments/agencies.

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

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vs. DBCC Program

vs. Agency MCP

vs. DBCC Program

vs. Agency MCP

294,947 235,081

8 Departments 119,927 79,291 87,639 (32,288) (8,348) 258,018 167,559 216,944 (41,074) 49,385

Percent (%) to Total 41 30 37 54 (27) 40 28 37 80 877

DepEd* 45,550 71 42,804 (2,746) 42,733 99,375 155 100,113 738 99,958

DPWH 34,743 37,662 17,756 (16,987) (19,906) 72,814 81,334 53,749 (19,065) (27,585)

DA 12,657 12,569 7,513 (5,144) (5,056) 31,111 31,323 19,551 (11,560) (11,772)

DSWD 11,772 11,775 8,932 (2,840) (2,843) 19,862 18,365 17,839 (2,023) (526)

DOH 5,657 6,436 4,100 (1,557) (2,336) 13,492 14,180 10,311 (3,181) (3,869)

DENR 4,159 4,351 2,135 (2,024) (2,216) 8,516 8,391 5,294 (3,222) (3,097)

DAR 2,450 2,829 1,628 (822) (1,201) 6,335 5,877 3,958 (2,377) (1,919)

DOTC 2,939 3,598 2,771 (168) (827) 6,513 7,934 6,129 (384) (1,805)

*DepEd has not submitted MCPs for its regional officesSource: MDS-GSB Report for Payments Made

Excess/Shortfall

Total, NG 266,471 (59,866) (31,390) 645,400 588,702 549,334 (51,066) 5,632

Particulars

AS OF MARCH 31, 2012 AS OF JUNE 30, 2012

DBCC Program

Agency MCP

Pre-AMT Payments

Excess/Shortfall

DBCC Program

Agency MCP

AMT-Guided Payments

(In Million Pesos)(In Million Pesos)

Source: BTS Paper on AMTSource: BTS Paper on AMT

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1. Policy Issues

2. Internal processes, systems and procedures

3. Communication

4. Organization (Supervisory/manpower concerns)

AMT-Classified Factors Affecting AMT-Classified Factors Affecting the Underspending the Underspending

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THE CHALLENGESTHE CHALLENGESHow 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)

MADAMO GID NGA SALAMAT

(Maraming Salamat)