The Department of Budget and Management has been in the spotlight in the last two years, no thanks to the Priority Development Assistance Fund and the Disbursement Acceleration Program controversies. In most administrations, the DBM usually prefers to work under the radar even as it plays a critical and all-important role of rationalizing government spending and ensuring accountability of public officers and employees over government resources. Indeed, the DBM guarantees efficient and sound utilization of government funds and revenues to achieve the country’s development goals.
Thus, to be effective and to deliver on its mandate, the country’s budget agency must continually reinvent itself. Reforms in its processes are needed to achieve a budget which Secretary Florencio “Butch” Abad promised to the House of Representatives: “We have produced a budget that moved away from the practice of incremental and leakage-prone allocation of scarce resources; lump-sum appropriations; and moved towards performance-based outcome budgeting.”
As part of its commitment to deliver efficient public service, the DBM recently attained its department- wide ISO 9001:2008 Certification. Such certification is a big thing. This means that the organization has earned the seal of approval of the international standardization group measuring the quality of service in terms of quality management, environmental management, social responsibility, energy management and risk management.
So far, the DBM is the only Philippine government agency that has achieved this feat. In other words, its management system standards measure up to internationally set and recognized standards.
DBM also has made a significant stride in the field of transparency. This result is to a large measure ascribable to the Bottom-Up Budgeting Program adopted by the government. This program was cited by no less than American ambassador to the United Nations Samantha Power at the Open Government Partnership global summit in Mexico City. The program requires grassroots participation in the planning and budgeting of poverty-reduction programs in every one of the country’s 1,634 municipal and provincial governments. This results in the increase of citizen participation in the formulation and implementation of government programs allowing for custom-built programs more responsive to local needs.
These improvements are reflected in the 2015 Open Budget Survey, the world’s only independent comparable measure of budget transparency, participation, and oversight. For 2015, the OBS examined the three pillars of budget accountability, namely: transparency, public participation and budget oversight of 102 countries. The Philippines was one of the few that garnered high marks in three of four pillars of budget accountability. This, notwithstanding the survey findings indicating that most countries currently provide few opportunities for the public to participate in budget processes.
In the survey, the Philippines scored 64 (out of 100) in transparency which means that the government provides the public with substantial budget information. Sixty seven (out of 100) in public participation means that the public is provided adequate opportunities to engage in the budget process. In this area, the Philippines outshone most countries as it ranked 4th out of 102 countries surveyed.
Our country achieved a whopping 92 adequacy rating in oversight by the supreme audit due primarily to the Commission on Audit’s constitutional independence.
The weak spot, however, can be found in the oversight by the legislature with very limited participation in the processes of the legislature and the supreme audit institution (SAI; for us, this is the Commission on Audit or CoA), garnering low scores of 47 and 59, respectively.
After languishing in the cellar like most countries with limited budget transparency, the Philippine now belongs to the elite group of 24 countries with substantial or extensive budget transparency. Overtaking 26 other countries, the Philippines now ranks 21st in the world, fourth in Asia, and 1st in Southeast Asia when it comes to transparency.
The improvement in the country’s Open Budget Index performance may also be attributed to its being able to publish eight essential budget documents when historically we could only manage to publish three to four of the eight budget documents, particularly the Pre-Budget Statement, the Mid-Year Review, the Year-End Report, and the Citizen’s Budget. This year, we are one of only 16 of the 102 countries which published all eight budget documents. In contrast, of the 816 documents that should have been published globally (i.e. eight documents times 102 countries), 267 or about one third are not publicly available.
Despite marked escalation in the overall ratings, the strength of the Philippines budget performance remains mixed. Legislative oversight remaining weak, while Supreme Audit Institution continued to be adequate. As we have seen, the weakness of the legislative oversight manifested itself when allegations of misuse by several members of Congress of their PDAF (popularly called pork barrel) erupted. But in hindsight, the fact that it came out at all during this administration may be an undeniable proof of the improving climate of transparency in the country’s budget processes.
By way of conclusion, the OBS Report for 2015 made a number of important recommendations that may serve as an important guidepost with which this and the next government can take their bearings as they seek to achieve optimal fiscal and budgetary policy and management. The recommendations include the publication of more information to boost public awareness on budgetary processes; institutionalization of gains in transparency; and providing more opportunities for public participation. The report further suggested the empowerment of oversight institutions by improving legislative capacity to engage with the budget in a meaningful way through better access to research and analytical capacity. And finally, the promotion of the development of integrated and accountable budget ecosystems to ensure appropriate checks and balances.
Now that the Apec summit is out of the way, government must now turn to pressing matters. Among the most important of this is the approval of the national budget. I am happy that we have a reformed DBM that is up to this task. Secretary Abad and his DBM colleagues should be credited for bringing the DBM where it is today.
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