New budget scheme frees P581B for 2016


THE Department of Budget and Management (DBM) has introduced a new budgetary system, the Two-Tier Budgeting Approach (2TBA), which will free up P581 billion for expanded and new programs and projects in 2016, an election year.

In a statement released on Thursday, Budget Secretary Florencio Abad said the new approach will give more room in the 2016 budget for new socio-economic programs.

“The DBM was able to come up with this estimated fiscal space thanks to the Two-Tier approach, which gives agencies a better focus on program planning. Under this approach, government departments are able to prioritize which of their programs they can concentrate on to accommodate more productive expenditures,” Abad said.

The introduction of the 2TBA, however, is seen to draw flak from critics who had lashed at the Aquino government in the past for introducing budget schemes like the Bottom-Up Budgeting and Grassroots Participatory Budgeting which were widely seen as the revival of pork funds.

According to the DBM, the 2TBA approach was adopted in line with the Aquino administration’s efforts to craft a national budget that will be responsive to the needs of all Filipinos.

The proposed 2016 national budget of P3.0 trillion is higher by 15.1 percent than this year’s P2.606 trillion, or an increase of P394.0 billion.

Abad explained that the P581 billion that will be used for new programs and projects comprises 20 percent of the proposed P3 trillion budget for 2016 and is more than double last year’s fiscal space of P287 billion.

Around 80 percent of the proposed budget—or P2.42 trillion—will be allotted to the implementation of existing or ongoing programs and projects of the government, he said.

The government came up with the P581 billion fiscal space estimate in the wake of the Tier 1 assessment of the budgetary process, which looked at the projected budgetary requirements of ongoing programs and projects, Abad explained.

Currently, the DBM is conducting Tier 2 consultations as part of the Technical Budget Hearings (TBH), where budget proposals for new or expanded programs and projects can be submitted for consideration.

However, departments and agencies shall ensure their proposals are supportive of the strategies and objectives identified in the Budget Priorities Framework (BPF) and they will need to justify these during the consultation process, which started on May 18.

The 2TBA was instituted by the DBM under the National Budget Memorandum (NBM) No. 123, which separates deliberations of ongoing programs and projects from the expansion and new spending proposals.

“Using the Two-Tier approach, we’re able to fine-tune our budget process by establishing a clearer framework to determine the allocations for ongoing programs and projects. We’ve also set up a process to evaluate new and expanded proposals so as to encourage agencies to think of more innovative programs and projects that will benefit Filipinos. This allows us at the DBM to focus on the evaluation of these new spending proposals in terms of their quality and significance,” Abad said.


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