Department of Budget and Management

This volume of the President’s Budget for FY 2011 is submitted to assists Congress in the review and deliberation of the proposed national budget for legislation of the annual appropriations measures for the ensuing fiscal year. It is presented into four (4) parts, namely: Part I – National Government Budget; Part II - Budgets of the three (3) Energy Corporations; Part III – General Provisions; and Part IV – Detailed Annexes.

The FY 2011 Expenditure Program

Of the total proposed expenditure program for FY 2011, P1.0 Trillion represents New General Appropriations which require legislative authorization. This amount already includes the proposal for a P66.9 Billion standby authority which could only be released when revenue collections exceed revenue targets. The highlights of the New General Appropriations contained in this volume is further discussed below.

The amount of P711.5 Billion, on the other hand, represents expenditure items which Congress deemed fit to automatically appropriate. By virtue of their nature and urgency, Congress provided continuing legal authority for these expenditure items through subsisting legislation. These automatically appropriated items include debt service-interest payments, net lending, IRA, government contribution for employees retirement and life insurance premiums, special accounts in the general fund, grant proceeds and donations. The breakdown of automatic appropriations presented per department are shown in Table "H" of the BESF.

The New General Appropriations

The proposed P1.0 Trillion New General Appropriations as shown in Annex "A" is allocated among the various departments and special purpose funds, as follows:

Departments and Agencies	769,346,284
Special Purpose Funds	231,041,480
TOTAL, New General Appropriations	1,000,387,764
Less: Unprogrammed New Appropriations	66,908,492
Programmed New Appropriations	933,479,272

Consistent with the constitutional mandate of giving the highest priority to education, the DepEd gets P193.3 Billion (inclusive of the DepEd Educational Facilities Fund) out of the proposed national budget. The other top departments are: DPWH, P100.8 Billion; DND, P104.5 Billion; DILG, P86.9 Billion; and the DA (inclusive of its Agricultural and Fisheries Modernization Program component), P37.3 Billion.

To promote transparency and accountability, previous allocations under certain SPFs for which specific user-department/agency is identified were incorporated in the built-in appropriations of the concerned department/agency. For instance, the pension requirements for retired military and uniformed personnel were incorporated in the built-in appropriations of DND, DILG, National Mapping and Resource Information Authority and Philippine Coast Guard. Likewise, the National Unification Fund was included under the budget of Office of the Presidential Adviser on the Peace Process. Thus, the significant increases in the budgets of these departments.

Under SPFs, substantial amounts are provided to the Miscellaneous Personnel Benefits Fund (MPBF), P71.7B; the Retirement Benefits Fund (RBF), P35.0B, the Priority Development Assistance Fund (PDAF), P24.8B; and the Allocation to Local Government Units, P13.1B. The increase in the provision for MPBF is attributed to the inclusion of the annualized requirement of the 2nd tranche salary increase (made effective June 24, 2010) and the 3rd tranche salary adjustments under the Salary Standardization Law III. The provision under the RBF, formerly Pension and Gratuity Fund, is now limited to the requirement for the Retirement Gratuity and Terminal Leave benefits of retired government personnel, Incentive Package for employees availing of the Rationalization Program and the monetization of transferred leave credits of National Government personnel devolved to the LGUs. Again, to enhance transparency, the congressional allocations are all lodged under PDAF. Thus, PDAF allocations now includes both the hard (roads, bridges etc.) and soft (scholarships, grants, etc.) components of the program.

The details of the budgets of Departments and SPFs are presented in Summary Tables I-1 and I-2.

Summary Table I-1
Summary of Proposed New Appropriations by Department, FY 2011
(In thousand pesos)

	Proposed New Appropriations
DEPARTMENTS	Personal Services	Maintenance and Other Operating Expenses	Capital Outlay	Total
Congress of the Philippines	3,624,550	3,881,488	300	7,506,338
Office of the President	1,576,856	2,482,147	16,504	4,075,507
Office of the Vice President	36,570	137,301	3,236	117,107
Agrarian Reform	4,268,750	9,246,677	2,850,086	16,365,513
Agriculture	2,848,153	11,817,255	22,592,565	37,257,973
Budget and Management	323,753	397,906	31,620	753,279
Education	151,489,456	25,180,163	15,643,237	192,312,856
State Universities and Colleges	18,913,029	2,804,392		21,717,421
Energy	204,950	687,944	37,170	930,064
Environment and Natural Resources	5,714,481	4,015,011	2,546,958	12,276,450
Finance	5,252,020	3,788,990	1,560,955	10,601,965
Foreign Affairs	5,240,240	5,643,699	151,745	11,035,684
Health	7,830,060	15,860,353	8,937,031	32,627,444
Interior and Local Government	74,625,318	10,022,010	2,266,188	86,913,516
Justice	4,953,762	2,133,878	64,391	7,152,031
Labor and Employment	2,929,165	3,299,074	169,463	6,397,702
National Defense	82,335,587	17,083,582	5,085,752	104,504,921
Public Works and Highways	3,828,718	6,310,164	90,687,201	100,826,083
Science and Technology	1,315,221	4,062,874	611,764	5,989,859
Social Welfare and Development	725,379	33,114,837	353,701	34,193,917
Tourism	291,450	1,140,082		1,431,532
Trade and Industry	973,766	1,243,436	271,424	2,488,626
Transportation and Communications	3,331,615	10,765,048	17,088,425	31,185,088
National Economic and Development Authority	1,083,964	970,749	45,837	2,100,550
Presidential Communications Operations Office	505,605	391,551	32,442	929,598
Other Executive Offices	2,089,284	2,247,017	84,886	4,421,187
Autonomous Region in Muslim Mindanao	7,480,457	2,222,783	1,476,398	11,179,638
Joint Executive-Legislative Council	1,625	500	60	2,185
The Judiciary	10,035,881	3,500,519	85,118	13,621,518
Civil Service Commission	532,873	128,179	5,800	666,852
Commission on Audit	3,968,345	181,289		4,149,634
Commission on Elections	1,546,114	709,331		2,255,445
Office of the Ombudsman	843,548	188,353		1, 031,901
Commission on Human Rights	207,548	59,352		266,900
GRAND TOTAL	410,928,093	185,717,934	172,700,257	769,346,284

Table I-2
Summary of Proposed New Appropriations by Special Purpose Funds, FY 2011
(In thousand pesos)

SPECIAL PURPOSE FUNDS	Proposed New Appropriations			Total
SPECIAL PURPOSE FUNDS	Personal Services	Maintenance and Other Operating Expenses	Capital Outlay	Total
Budgetary Support to Government Corporations		7,184,357	1,005,550	8,189,907
Allocation to Local Government Units	26,533	12,765,353	265,505	13,057,391
Calamity Fund		3,450,000	1,550,000	5,000,000
Contingent Fund		740,000	260,000	1,000,000
DepEd Educational Facilities Fund			1,000,000	1,000,000
E-Government Fund			1,100,000	1,190,000
International Commitments Fund		3,174,820		3,174,820
Miscellaneous Personnel Benefits Fund	71,700,870			71,700,870
Retirement Benefits Fund	35,000,000			35,000,000
Priority Development Assistance Fund		7,836,500	16,983,500	24,820,000
Total Programmed New Appropriations	106,727,403	35,151,030	22,254,555	164,132,988
Unprogrammed Fund	8,662,810	15,355,188	42,890,494	66,908,492
GRAND TOTAL	115,390,213	50,506,218	65,145,049	231,041,480