Senate finance committee introduces reforms to 2014 budget

By Office of Senator Chiz Escudero
November 19, 2013

PASAY CITY – Senator Chiz Escudero, chairman of the Senate Finance Committee, presented for plenary debates the P2.267 trillion spending plan of the national government for 2014 which includes key reforms to ensure proper use of funds, transparency and integrity of the budget process.

According to Escudero, the proposed budget is the “most detailed” in the country’s history to date, itemizing almost all items earmarked for personal services, maintenance and other operating expenses down to capital outlays.

This means that the special allotment release order or SARO, a long-standing system that authorizes a government agency to incur obligation not exceeding the amount set aside for a specific period, is removed from the proposed appropriation for next year.

“One other innovative key reform instituted is the movement towards a budget-as-release-document in 2014. Simply put, the Department of Budget and Management declares that ‘the budgets of agencies – except those to be contained in a negative list – are considered released to them as soon as the national budget takes effect,” Escudero explained.

Another key feature of the budget proposal is the elimination of the pork barrel allocation of 15 senators amounting to P3.2 billion, which will be rechanneled to four key government agencies. The spending package also slashes the P200-million allocation of the Office of the Vice President.

Next year’s budget, which is 13.07 percent higher than the 2013 appropriations, will be sourced from the P2.018 trillion projected revenues broken down as follows: 15.1 percent of the gross domestic product (GDP), 2014 tax revenues effort of 14.1 percent amounting to P1.879 trillion, and P136.13 billion from non-tax revenues.

“The biggest slice of next year’s budget pie will be consumed by social services at 37 percent or P842.81 billion, followed by economic services at 26 percent or a total of P590.22 billion,” Escudero said.

Other sectors will share the proposed budget as follows: defense, 4.09 percent (P92.85 billion); general public services, 16.07 percent (P364.52 billion); net lending, 1.10 percent (P24.95 billion); and debt service interest payments, 15.55 percent (P352.65 billion).

In the budget bill of the House of Representatives, the Priority Development Assistance Fund (PDAF) of the senators was equally appropriated to the Commission on Higher Education (CHED), the Department of Health (DOH), the Department of Labor and Employment (DOLE) and the Department of Social Welfare and Development (DSWD).

Also included in the Senate version is the creation of a new special purpose fund amounting to P20 billion to be used for the rehabilitation, repair and reconstruction works and activities in areas affected by typhoons Yolanda, Santi, Labuyo and the 7.2 magnitude earthquake.

Escudero appealed to his colleagues to support the 2014 budget, saying the spending plan will enable the government deal with the financial requirements for rebuilding and rehabilitating areas severely affected by both natural and man-made disasters.