CONTRARY to the spirit and letter of the Constitution, in practice it is the Office of the President, not Congress, which holds the power of the purse, according to former national treasurer Leonor Magtolis Briones, lead convenor of Social Watch Philippines (SWP), a budget transparency group.
In a press conference on “The 2015 Budget and Congress’ Power of the ‘Coin Purse’” on Aug. 14, 2014, Briones lamented that the legislature’s vaunted power “has been diminished through the years.”
This is evident, she said, in what she called the 2015 “election budget” that enrolls “lump sums, automatic appropriations, and off-budget directs remittances.”
“Lump-sums indicate an inherent vulnerability in the budget because of limited transparency and accountability in handling these funds,” said Briones, a professor emeritus of the University of the Philippines.
Because the Executive controls the bulk of the budget, Congress is left only to holding “the power of the coin purse,” she said in a press statement.
By its calculation, SWP said that the proposed total expenditures of P2.758 trillion in 2015 consists of P2.606 trillion in proposed appropriations,P123 billion in Unprogrammed Expenditures, and P29 billion off budget accounts and direct remittances from the Philippine Gaming Corporation (PAGCOR) and Philippine Charity Sweepstakes Office (PCSO).
“The Appropriations Act which will be approved by Congress totals P1.740 trillion,” Briones said. However, of this, “only agency budgets of P1.361 trillion will be debated in great detail while P866.231 will be automatically appropriated,” or less than half of the total expenditures.
Of the proposed P2.758-trillion expenditures, Briones said Congress will likely debate in detail only P1.361 trillion of government agency budgets, including P761.231 billion in Personnel Expenditures that is generally accepted by Congress as presented by the Executive.
This leaves only P599.769 billion for detailed Congressional scrutiny, she said.
Among others, Briones said the “significant lumps” in the proposed budget include the President’s Special Purpose Fund (SPF) of P378.603 billion.
Commonly referred to as “the President’s pork,” she said only the Department of Budget and Management could release these funds with the approval of the President.
In addition, Briones said there have also been “significant increases” in other lump-sum funds, including:
* Allocations for Local governments, from P19.589 billion in 2014 to P33.131 billion in 2015;
* Budgetary Support to Government Corporations, from P46.255 billion to P61.319 billion; and
* Miscellaneous Personnel Benefits Fund, from P53.53 billion to P118.142 billion.
The total amounts for SPFs increased from P282.569 billion to P378.603 billion in the 2015 proposed budget.
According to Briones, these items indicate that the 2015 budget proposal could well be “an election budget, where the government cranks up spending on infrastructure and visible projects to create the impression of growth.”
“Ruling parties can use these projects their advantage for re-election. However, the growth might be superficial it would be very challenging to sustain the same levels of growth,” Briones said.
On Debt Servicing, Briones cited that “while government is planning to borrow a total of P700.822 billion, it will only receive P310.435 billion for both peso and foreign borrowings due to costs of borrowing and other charges.”
Debt servicing is also usually overstated by the Executive as a means to liberally move around funds in the budget, she added.
“Executive control is apparent in the proposed budget. After the budget is passed, Executive power may even disregard the Congress’ approved budget altogether,” Briones said.
She noted that Rep. Ben Evardone of Eastern Samar, an ally of President Benigno S. Aquino III’s Liberal Party, had submitted a bill that, if passed, would redefine savings and allow the Executive to declare and pool “savings” any time within the year.
Last August 1, Briones recalled that Budget Secretary Florencio Abad submitted a proposed bill to redefine savings and unprogrammed expenditures.
This development, she averred, could further diminish Congress’s power of the purse.
“Proposals to redefine ‘savings’ to accommodate practices similar to the controversial Disbursement Acceleration Program (DAP) in the future also further diminish the Congress power of the purse, as it allows the Executive to liberally move funds around beyond the limits of the budget law,” Briones said.
SWP Co-Convenor Isagani Serrano, meanwhile, urged that the national budget be used to address social inequality in the country, adding that the budget in previous years have failed to do so in the pass.
“With our high numbers of growth and gross domestic product (GDP), we also have high rates of unemployment, poverty, and hunger,” said Serrano, president of the Philippine Rural Reconstruction Movement.
He cited that the proposed budget shows that “there has been virtually no improvement in these social indicators,” citing “stark regional disparities among the major islands in the Philippines, with 63 percent (of the proposed 2015 budget) going to Luzon, 16 percent to the Visayas and 21 percent to Mindanao.”
“This is in spite of the fact that the poorest provinces are located in the Visayas and Mindanao,” he said.
“The budget explicitly says that it was crafted for the poor, and with Yolanda (Haiyan) heavily affecting the Visayas, you would have expected more allocations to the Visayas,”
“This isn’t the case,” Serranno said. “The budget is even sorely lacking in addressing climate change adaptation and disaster preparedness.”
Briones exhorted lawmakers to reclaim the legislature’s power of the purse. This is necessary, she said, “to reclaim the balance of power in government, something that is an important component of our democracy.”