DBM sets rules for identifying project spending priorities

THE BUDGET department said it will evaluate new projects against the administration’s agenda, in order to determine priorities as it prepares the 2018 spending program.

In National Budget Memorandum No. 128, dated March 23, the Department of Budget and Management (DBM) provided guidelines to determine how the P652.9 billion to be set aside for new programs and projects will be allocated.

The multi- agency Development Budget Coordinating Committee ( DBCC) in its Dec. 20 meeting assumed a P3.84 trillion budget for 2018, with 83% earmarked for ongoing projects (Tier 1) and 17% for the new projects (Tier 2).

“[ T] he FY 2018 Budget will provide the funding requirements for at the minimum, the most urgent and ready of these priority programs and projects identified in the PDP 2017-2022,” the DBM said.

The 2018 budget will be the first budget handled solely by the Duterte administration. Budget Secretary Benjamin E. Diokno said in the 2018 budget call issued earlier that agencies should incorporate the government’s 10-point socioeconomic agenda in drafting their proposals.

Sought for comment, DBM Undersecretary Laura B. Pascua said via text message: “This is the way we try to restructure the budget to be more supportive of the government’s priority programs.”

These programs are grouped into five pillars: enhancing the social fabric, reducing inequality, increasing potential growth, enabling a supportive environment, and maintaining the foundation for sustainable development.

DBM added that the budget for new projects will be granted to agencies with the following considerations: The project’s implementation- readiness, the agency’s absorptive capacity, consistency with government priorities, and the quality of agency planning.

“Projects and programs that will be included in the budget must be implementation- ready to maximize the allocation,” said the DBM.

“The agency absorptive capacity shows the likeliness of the proponent agency to utilize possible new allocations. A low absorptive capacity shows the agency is unlikely to utilize additional funds,” it added.

At end- February, the utilization ratio for notices of cash allocations (NCAs) — or cash authority issued to cover the cash requirements of government agencies — fell to 82% from 88% a year earlier.

Government agencies have until March 31 to submit their proposals to fund their new projects.

The DBM said that spending for the economic services sector is targeted to expand from 5.8% of gross domestic product (GDP) to 6.6% next year, while social services spending will represent 9.2% of GDP from 8.5% this year.

The administration expects to post a 6.5-7.5% rise in gross domestic product this year and 7-8% annually until 2022, aiming to lift about 6 million Filipinos out of poverty, reducing the poverty rate to 14% in the same period from 21.6% in 2015.

It also expects to spend up to P9 trillion from 2017 to 2022 to plug the infrastructure gap, which is expected to propel the country’s per capita gross national income to $4,900 in 2022 and eventually to $11,000 by 2040 from $3,550 in 2015. —