The budget process: PCIJ’s 20th anniv conference

The second day of the conference began with Prof. Leonor Magtulis-Briones, president of SocialWatch-Philippines and a faculty member at the University of the Philippines-National College of Public Administration talking about the budget process. She detailed how the current setup renders the check and balance of Congress virtually ineffective because of the powers of the executive. She discussed issues such as budget impoundment or non-release, budget re-enactments which lead to increase in allotments, and the creation of special purpose funds that take up more than half the budget.

These special purpose funds (SPFs), according to Prof. Briones, contain many lump-sum appropriations and are highly discretionary. A look at the items in these funds reveals that interest payments, allocation to local government units, and pension and gratuity funds take up the most budget. Also among SPFs are Priority Development Assistance Funds (PDAFs) for legislators, otherwise known as pork barrel, amounting to PhP6.9-billion in 2008. The figure dwarfs calamity funds in the SPFs, which only amount to PhP2-billion, and contingency funds, which are allocated PhP800-million. Contingency funds, in addition, have been known to be used by the President for foreign travel to augment the approximately PhP200-million travel appropriation. COA findings have also revealed that the administration routinely reallocates funds from departments and agencies to SPFs.

Prof. Briones also talked about the lack of participation of civil society in the budget process, which is exacerbated by the current practice of the bicameral budget hearings no longer being open to the public.

Prof. Briones talked about the alternative budget process, something that is gaining ground the world over. The process involves civil society groups formulating their own budgets and being involved directly in the preparation, legislation, review, and monitoring of appropriations. “At the start of the budget session, we hold capacity-building sessions for civil society organizations. We walk them through the budget process. Since they already have knowledge of the alternative budget process, they come up with their own budgets,” Prof. Briones said.

Finally, in the Q&A session, Prof. Briones highlighted the need for media to become more knowledgeable in budget reporting. She cited as example how funds can be used in different ways without anyone looking. “There is a footnote, a very very tiny footnote [in the appropriations act] that says [the contingency fund] can be used for travel expenses,” said Prof. Briones. “You can use the contingency fund for Ondoy, because the calamity fund is only P2-billion, and you need more than P2-billion obviously because the whole country is involved. But a footnote can make a lot of difference.”