Budget and Management Secretary Florencio “Butch” Abad on Friday said Congress needs a clear definition of the term “savings” in the proposed national budget to settle the controversy surrounding the Disbursement Acceleration Program (DAP).
Marikina City Rep. Miro Quimbo, chairman of the House Committee on Ways and Means, earlier said a joint resolution on the definition of savings is expected to be approved in the next two months so it would have a retroactive effect on the savings accumulated in 2014.
The General Appropriations Acts from 2011 to 2013, when the DAP was implemented, defined savings as funds that are “still available after the completion, or final discontinuance, or abandonment of the work, activity or purpose for which the appropriation is authorized.”
Abad said the executive may no longer ask for a supplemental budget for 2014 if it would be able to clarify the definition of savings in this year’s national budget.
“If Congress is able to pass the law in August and make it retroactive, we may not ask for supplemental budget,” he told reporters.
The supplemental budget, Abad explained, will supposedly be used to finish the DAP-funded projects that remain pending after the Supreme Court ruled parts of the program unconstitutional.
He said Congress must clarify three issues related to savings in light of the Supreme Court decision.
“The first issue has to do with the definition of savings which of course we have in the national budget, as well as the timing of the declaration of savings,” Abad noted.
The second issue has to do with the activation of the standby or the program appropriations and the timing of the declaration of the excess or new sources of revenue that are needed to operate the standby appropriations.
The third is about the definition of “item of appropriation” as distinguished from allotment class or objects of expenditure.
After the Supreme Court made the ruling on the DAP, Malacañang revised the definition of savings in the proposed 2015 national budget.
Savings now means portions of allocations that “have not been released or obligated due to discontinuance or abandonment of a program, activity or project for justifiable causes, at any time during the validity of the appropriations.”
Abad said even if Congress passes the joint resolution on the definition of savings, the Supreme Court should also clarify its ruling.
“It is not enough that Congress passes the law, the SC also has to strike it out or simply say that its ruling on DAP is considered only as opinion,” he added.
Abad maintained that the DAP was introduced by the government in 2011 as a reform measure to counter government underspending, which was a result of inherent weaknesses in the budgeting systems.