DBM to release 100% of agency allotments for the first time

A Janaury 7, 2011 press release prepared by the Department of Budget and Management

Secretary Abad: New rules ensure timely project implementation with accountability

The Department of Budget and Management (DBM) has established new budget execution rules that make available 100% of 2011 agency allotments.

“Dapat lang na sa pagpapatupad ng Reform Budget ay may reporma (Having a Reform Budget necessitates budget execution reforms). We have issued unprecedented rules that support the timely implementation of programs and projects, while ensuring transparency and accountability in the use of funds,” Budget and Management Secretary Florencio B. Abad said.

“Among the key rules we established is, for the first time, we are comprehensively releasing to agencies P717-B appropriations corresponding to items in General Appropriations Act (GAA) for programs, activities and projects which have been fully identified, with some detailed, in the GAA. Net of automatic appropriations, this constitutes 74% of the total budget. These allotments, which do not need clearance for their release, are fully made available to agencies under their Agency Budget Matrices (ABMs),” he said.

He said this new policy is among those being established by National Budget Circular (NBC) No. 528—the “Guidelines on the Release of Funds for FY 2011”— has been discussed in National Budget Fora within the DBM and with national government agencies and government corporations on January 6 and 7.

The National Budget Call, which starts the preparation process for the proposed 2012 national budget, has also been issued and discussed in the said fora.

The reform advocate further stressed that NBC No. 528, issued on January 3, 2010, also mandates the submission by agencies on February 15 this year of Budget Execution Documents that outline their plans and performance targets; and the quarterly submission of Budget Accountability Reports that itemize actual accomplishments of the agencies.

“We’ll be posting on the DBM website these submitted documents and reports, as well as the compliance of agencies with these requirements, for the public to scrutinize. Under the NBC, we will not release additional funds to agencies who do not comply with these reportorial requirements,” he said.

Abad notes that in the past, only 75% of budget items classified as “not needing clearance” are released under the ABM, and 25% of these have been withheld pending accountability reports and the undertaking of agency performance reviews in the third quarter. He said the practice of withholding funds only delays the implementation of programs and projects.

Under NBC No. 528, budget items under the ABM shall be segregated between those “needing clearance” and those “not needing clearance.” Those budget items which are considered as “not needing clearance” will be released 100% under the ABM, an official document that disaggregates all programmed appropriations of each agency and provides the basis for determining the timing, composition and magnitude of releases.