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BY: Professor Emeritus Leonor Magtolis Briones

U.P. National College of Public Administration and

Governance

Lead Convenor, Social Watch Philippines

Chair, Peoples Public Finance Institute

Chair, Silliman University

September 28, 2013

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Importance of the Budget inNational Development The Philippines is facing many challenges, the

most serious of which are poverty, climatechange, health and education, andunemployment.

The budget is the most powerful instrument of thegovernment in responding to these problems.

It can be an instrument for the redistribution ofincome groups to fund services and create jobs forthe poor.

The budget can be used to provide education andhealth services, as well as training and capacitybuilding and fund projects to create employment.

The budget can be used to stabilize the economyand control inflation.

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Importance of the Role of theCongress in the Budget The need to ask questions on the analysis

of the government on the performance ofthe economy, its policies, thrusts andpriorities

The need to ask questions on what isexplicitly stated, and also the moreimplicit or what is not there

The need to engage the executive onlongstanding issues on citizensparticipation, special purpose funds, etc.

The need to demand accountability fromthe government

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Importance of the Role of theCongress in the Budget

The Budget is an instrument of fiscalpolicy which includes policies on revenues,expenditures and borrowing

The Budget as part of fiscal policy hasthree functions:Allocation functionDistribution functionStabilization functionTo these three functions, I add theDevelopment function

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Basic Facts about the Budget

National Expenditure Program- the total amount of projected expenditures

for 2014 PhP 2.268 trillion

the General Appropriations Actwhich will be approved by Congress -PhP 1.472 trillion

the above amount is composed ofthe budget of departments and agencies - PhP 1.162 trillion

Special Purpose Funds -PhP 310 billion1.472 trillion

the Special Purpose Funds includes the PDAF OR pork barrel -PhP 25.2 billion

Automatic Appropriations which is composed of -PhP 796 billion

Debt Service-interest payments -Ph352.7 billioninternal revenue allotment -PhP 341.5 billionnet lending -PhP 24.9 billionretirement life insurance premiums -PhP 28.9 biliionspecial accounts in the general fund -PhP21.1 billion

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In addition to the National ExpenditureProgram, there is the UnprogrammedFund---------------------PhP 139.9 billion

Furthermore, there are the Off Budgetfunds" which are direct remittances.

Examples : PAGCOR remittances to the Office of thePresident (ph 2.6b)

Malampaya Funds (ph 26b) Motor Vehicles Users Charge(ph12 b) (Members of Congress are alloted 10M each from MVUC)

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of pork and lump sum

appropriations...

lump sum for Congress--------------------------25.2 billion

lump sums under the control of the PresidentSpecial Purpose Fund ---------------310 billion

Direct Remittances-------------------------------40.6 billion

Unprogrammed Funds---------------------------139.9 billionIntelligence Funds-------------------------------846 million

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Under the constitution as currentlyinterpreted, the President cancreate savings, transfer expenditures fromone agency to another. thus he can move

items in the PhP 2.268 trillion expenditureprogram if he wishes. All presidents havedone this. It is, of course, vulnerable toabuse.

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Campaign Advocacy of Social Watch

1. Abolition of Special Purpose Funds whichincludes Pork Barrel

2. Transfer these amounts to the differentfrontline agencies; consider the ABI Proposals

3. Revisit the interpretation of the constitutionalprovision which allows the President to transferfunds in the General Appropriations Act. Thephrase his Office is interpreted as the entiregovernment system.

4. Integrate Off Budget items with the GeneralAppropriations Act5. Give details of Automatic Appropriations