DBM supports 2% cap on unprogrammed funds

THE Department of Budget and Management (DBM) on Tuesday said that it is supportive of the Senate’s move to lower the cap on unprogrammed appropriations to 2% of the national budget.

Senate Bill No. 1358 proposes a cap of 2% and allows Congress to allocate unprogrammed funds only to cover the requirements of priority projects or contingencies, as well as appropriations for foreign-assisted projects.

Budget Undersecretary Janet B. Abuel said the 2% limit is based on the average allocation of standby funds over the years.

“The 2% is based on the average over the years and we are looking for a basis but per our information, 4% has been internationally acceptable,” she told a joint Senate panel.

Critics have been calling out unprogrammed appropriations as another form of discretionary funding prone to abuse by lawmakers and officials, which prompted Congress to lower standby funds last year.

Acting Budget Secretary Rolando U. Toledo had earlier said the department is looking at lowering it to as low as 3%.

“We will leave that to the wisdom of Congress, but 2% or 3% would be okay with the DBM,” Ms. Abuel said. “We are supporting to limit to the barest minimum the unprogrammed appropriations.”

Former Budget Secretary Amenah F. Pangandaman, last year, proposed setting a 5% ceiling on unprogrammed appropriations to provide flexibility for unforeseen spending. However, Executive Secretary Ralph G. Recto, who formerly led the Finance department, criticized this as “excessive” and instead recommended limiting the cap to 2% of the national budget.

Senator Panfilo “Ping” M. Lacson said that the DBM must find a balance over limiting standby funding as it risks affecting financial flexibility in the government.

“Try to find a balance to this unintended consequence because there is a limitation to the financial flexibility of the executive. There may be cases where funding needs to be realigned by the Executive,” he said.

The Senate Finance Committee began deliberation of measures to modernize the country’s budget process, following a year marked by a massive corruption scandal which prompted the government to update its deliberation process.

Measures to update the country’s budget process has been included in President Ferdinand R. Marcos, Jr.’s common legislative agenda for the 20th Congress. — Adrian H. Halili