MANILA CITY -- Department of Budget and Management (DBM) Secretary Amenah Pangandaman on Monday, 25 July 2022, expressed support on the campaign of President Ferdinand R. Marcos Jr. towards achieving prudent fiscal management and bureaucratic efficiency, as outlined in his first State-of-the-Nation Address (SONA).
"We, at the Department of Budget and Management, are one with the President and vow to contribute to the pursuit of economic prosperity where no one is left behind," the Budget Chief said.
According to Secretary Pangandaman, the DBM will facilitate the implementation of reforms to reverse the pandemic’s adverse effects, sustain current economic gains, and restore the country’s development trajectory.
“We shall maximize our limited fiscal space and commit to prioritizing food sufficiency, infrastructure, and climate change goals. And we will do so with complete integrity, competence, and diligence,” Secretary Pangandaman said.
During the SONA, the Chief Executive underscored the need to institute government programs to achieve sound fiscal management, in order to swiftly address the effects of the pandemic to the economy.
“In terms of the economy we will implement a sound fiscal management. Tax administration reforms will be in place to increase revenue collection. Expenditure priorities will be realigned and spending efficiency will be improved to immediately address the economic scarring arising from the effects of the COVID-19 and also to prepare for future shocks,” President Ferdinand R. Marcos Jr. said.
“The Medium-Term Fiscal Strategy of this Administration seeks to attain short-term macro-fiscal stability while remaining supportive of the country's economic recovery and aims to promote medium-term fiscal sustainability. Furthermore, and more importantly, fiscal policy aims to bring together the national government's resources so that these are mobilized and utilized in order to gain the maximum benefit and the higher multiplier effect on our economy,” President Marcos added.
For her part, Secretary Pangandaman expressed confidence on the leadership of President Marcos to steer a course of stability and progress for the economy.
“The economy is in good hands with our President,” Sec. Pangandaman said.
“The MTFP is our response to the socio-economic needs of our people today for competitiveness, inclusivity and sustainability so we are grateful that President Marcos is 100% attuned to this economic transformation agenda of the economic managers,” the Secretary added.
Pangandaman likewise expressed her gratitude to Congress for the support the bicameral legislature has given to the 2022-2028 MTFP.
"With Congress's support for the MTFP, efforts will be harmonized which will facilitate prompt formulation and adoption of policies and reforms that will help the country back on the path to rapid economic growth," the Budget Chief stated.
Cash-based Budgeting System
The Chief Executive likewise identified the Budget Modernization Bill as a priority legislative measure of his Administration. He underscored the need to fully implement the Cash-Based Budgeting System (CBS) as part of the government's thrust.
“The Budget Modernization Bill seeks the institutionalization of the Cash-based Budgeting System (CBS) under Executive Order No. 91, s. 2019 to strengthen fiscal discipline in the allocation and use of budget resources by ensuring that every peso budgeted by the government would lead to the actual delivery of programs and projects. The full implementation of the CBS is timely and vital as the government executes response and recovery plans post-pandemic,” President Marcos said.
To fulfill this directive, Sec. Pangandaman said that the DBM will ensure the adoption and strengthening of the CBS implementation for the whole-of-government, coupled with other key reforms such as the Early Procurement Activity, to sustain the initial gains and "ensure that every peso budgeted by the government would lead to the actual delivery of programs and projects."
Under the CBS, all appropriations shall be made available for obligation and implemented only until the end of each fiscal year, while payments for obligations incurred may be settled within the year or up to an extended period of three (3) months after the end of the validity of appropriations. This will address bottlenecks in obligations, which will lead to on-time implementation and disbursement of the government’s programmed projects.
Rightsizing for lean, efficient and responsive government workforce
President Marcos Jr. ordered the establishment of a lean, efficient and responsive government workforce.
“[This is] a reform mechanism that seeks to enhance the government’s institutional capacity to perform its mandate/functions and provide better services, while ensuring optimal and efficient use of resources,” President Marcos emphasized.
“Compared to previous government reorganization efforts, the NGRP [National Government Rightsizing Program] will entail a comprehensive strategic review of the functions, operations, organization, systems and processes of the different agencies, and massive and transformational initiatives in agencies concerned, such as merger, consolidation, splitting, transfer, and abolition of offices. The rightsizing efforts will also involve the conduct of a comprehensive strategic review of functions, programs and projects that cuts across various agencies,” the President added.
To this end, Sec. Pangandaman said that the DBM will support the streamlining of the bureaucracy through the NGRP which will also generate savings for the government to fund priority projects.
“At the end of the day, a bloated and double-layered bureaucracy is a great disservice and a burden to our citizenry," Sec. Pangandaman underscored.
The Budget Secretary, however, pointed out that the NGRP does not automatically equate to the reduction in the number of personnel in government agencies.
"Rightsizing will strengthen the entire organization through the implementation of structural and procedural reforms that will ensure the government’s efficiency and productivity," she highlighted.
Digital transformation in government budget and management
In his speech, President Marcos stressed on the importance of pushing forward his administration’s campaign on digitalization.
“We are entering an age of exponential adoption of technology. It is the 4th industrial revolution. This will be characterized by the infusion of technology into almost every facet of our lives. Breakthrough technologies in the areas of quantum computing, artificial intelligence, nanotechnologies, internet of things… among others that will radically transform the way business is done,” President Marcos said.
Secretary Pangandaman vowed to support the President's push for digitalization that will accord the highest priority to public sector programs that promote transparency, accountability, and good governance.
"We shall expedite the digitalization of our public financial management system and the reforms on the procurement process and law,” she said.
Sec. Pangandaman said that the DBM shall roll-out its first 100-day Roadmap on digitalization to diminish human discretion and eradicate corruption, through the exploration of capabilities of cloud infrastructure and application programming interfaces (APIs) for real-time processing of government service, as well as blockchain technology for decentralized transparency.
“Ultimately, emerging technologies and capabilities will be utilized to digitize government processes, in accordance with the President’s 8-point socio-economic agenda,” Sec. Pangandaman said.
“We will focus on enhancing the Government Integrated Financial Management Information Systems (GIFMIS), that facilitates the generation of vital information on all aspects of government financial transactions, to be made publicly accessible through information technology,” the Secretary added.
To realize this, the Budget Chief stated that the DBM, together with the Department of Finance, Bureau of Treasury, and the Commission on Audit, will fast-track the development and implementation of the Budget and Treasury Management System (BTMS)— an integrated, web-based and fully-automated system designed to streamline and monitor various financial transactions of government agencies, which is an integral part of the GIFMIS.
"The implementation of the BTMS is a crucial digitalization initiative. It has already been introduced and pilot-tested by the government, and is presently being reviewed for improvement and optimization," Sec. Pangandaman said.
Towards a green public procurement
In order to support the Marcos Administration’s goal of ensuring sustainable management and use of natural resources by 2030, the Budget Chief stated that the DBM, through the Government Procurement Policy Board (GPPB), will spearhead the implementation of the Green Public Procurement (GPP) Roadmap.
The GPP Roadmap was crafted with a circumspect approach that reflects the principle of value for money, addresses suppliers’ readiness and builds on the capacity of existing procurement practitioners in government. This aims to radically transform the Philippine market by integrating green choices in public procurement and with the long-term perspective of achieving sustainable public procurement initiative.
"A GPP Manual is currently being crafted to guide procurement practitioners in embedding green specifications. To date, the government has seven (7) Common-use Supplies and Equipment (CSE) items with green specifications," the Budget Chief said.
Aligned with the President's SONA message of empowering local government units (LGUs), Secretary Pangandaman conveyed that the DBM will uphold Executive Order No. 138, which provides for the implementation of the full devolution of certain national government's functions to the LGUs.
The Budget Chief said that the DBM issued Local Budget Circular No. 146 dated July 7, 2022 prescribing the guidelines on the release and utilization of the Local Government Support Fund - Growth Equity Fund (LGSF-GEF), while the DILG initiated capacity development efforts and interventions in support of full devolution.
Pangandaman noted that the Committee on Devolution, led by the DBM and the DILG, will reevaluate and strengthen the framework upon which the devolution will be anchored to ensure continuous and efficient delivery of essential government services, while promoting local economic growth and autonomy.
"As we navigate our way to full economic recovery with prudent fiscal management and enhanced bureaucratic efficiency, I am confident that we will achieve our goals for economic transformation, growth, and sustainability,” she said.
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