This Congress just passed on third and final reading the General Appropriations Bill for fiscal year 2018, with P3.77 trillion as next year’s national budget. The National Government asked for an increase of 12.4 percent or P417 billion more than the 2017 budget. The Department of Public Works and Highways was allotted the greatest increase, followed by Department of Education, Department of the Interior and Local Government, Department of Transportation, and Department of Social Welfare and Development. Incidentally, these departments belong to the top ten recipients of the 2018 budget.
For the last four years, the national government has been experiencing difficulties in fully utilizing the annually approved budget. According to DBM reports, in 2013, there was substantial shortfall of P103.7 billion or 5.2 percent in government expenditures against disbursement targets; in 2014, at P302.7 billion or 13.3 percent; in 2015, 2.8 percent or P328.3 billion, nominally higher due to increased budget; while in 2016, underspending was considerably lower at P96.3 billion or 3.6 percent. On the other hand, the annual budget utilization rates of the agencies mentioned earlier, except for the DOTr, fell between 63 percent to 95 percent from 2012-2016, with DPWH recording the lowest average at 70 percent, and DILG at 95 percent.
As of Sept. 30, 2017, the DBM reported that 82.6 percent of the 2017 appropriated budget was released, with remaining P423 billion left to be disbursed. Likewise, as per the September report on the Notice of Cash Allocation, the DPWH was only able to utilize 51.8 percent of the total appropriations. DILG has utilized 83.2 percent, DepEd with only 45.7 percent, and DOTr, 37.18 percent.
With less than three months left before the fiscal year closes, we are looking at the dismal fiscal performance of executive departments. How can we therefore expect full utilization of the budget we just approved?
Failure and delay in submission of documentary requirements, poor liquidation of cash advances, procurement problems, delays in bidding, incorrect technical specifications and costings, difficulty in hiring, land acquisition and right-of-way issues, and delays in the approval of agreements and issuances of clearances are just some of the usual reasons of the chronic underspending identified by the DBCC.
In the recent Senate hearing on the budget, Senator Panfilo Lacson expressed his view regarding underspending. We agree. Both Houses of Congress pass the General Appropriations Bill. Failure to comply with its provisions is a violation of the said Act. We have to remember that the public is always on the receiving end of this unsatisfactory fiscal management. Poor budget utilization of the government deprives the public of the essential goods and services such as roads, bridges, and other infrastructure, health services, and quality education.
It was also seen that low government spending coexist with low GDP. In recent years, researches from the World Bank and the Australian and New Zealand Banking Group Ltd noted that increases in government consumption, particularly in infrastructure spending, highly correlate to GDP growth. It was hoped that the Build, Build, Build thrust of this administration will provide the economic boost that we need. However, underspending remains a problem.
The 2018 budget is considered to be the first true budget of the Duterte administration. Focus is laid on the improvement of social services such as health, education, and employment as well as accelerating infrastructure development and promotion of peace and order. While these are very promising, I reiterate my concern on the ability of the government agencies to fully utilize and spend their budget. During the GAA deliberations, most of the agencies subjected to questioning have promised better absorptive capacity and program planning. Let us not make the same mistakes committed by previous administrations where disbursement was always lower than what was programmed. The people have been promised change, and we should live up to our promise and make a difference. With this, I urge my fellow legislators to be more active in monitoring how the government spends its budget. I am repeating my call for a more vigilant Congress. We must make full exercise of our oversight powers to ensure that every centavo of the budget we approve each year is spent for the intended programs and services and such be delivered efficiently to the target sectors and the public in general.