House to resume hearings on the 2019 budget



AFTER reaching a "compromise" with Malacañang, the House of Representatives has decided to continue the deliberations for the national budget of 2019 when Congress resumes its session next week.

According to the schedule released by the House Press and Public Affairs Bureau on Wednesday, the allocation for the Department of Trade and Industry and Department of Education (DepEd) will be examined on 28 August.

Due to difficulties in shifting the country towards a cash-based budget system, the Parliament's Administrative Expenditure has temporarily suspended the deliberations for the national budget for 2019.

After discussions with the palace, the majority leader Rolando G. Andaya Jr. said. that the lower chamber will resume budget hearings during the two-week congress stop, which began on 16 August. Nevertheless, no hearing was held during the break.

According to Andaya, the Palace and the House of Representatives have agreed that the General Credit Act of 2019 (GAA) will adopt a "hybrid" of cash-based and obligation-based budgeting system.

The schedule released by the House also indicated that the hearings on the budgets of the President's office, the vice president's office, the Ministry of the Interior and the local government and the Ministry of National Defense would be held on 29 August.

Budget discussions for the Ministry of Labor and Employment and the Ministry of Foreign Affairs are scheduled for 30 August.

The budget meetings for the Information and Communication Technology Department and the Department of Health (DOH) were adopted on 3 September; Civil Service Commission, Commission for Human Rights, Department of Science and Technology, and the judiciary on 4 September; and the Presidential Communications Operations Office and the Department of Transportation on 5 September.

Cuts

Andaya previously said that the lower chamber is awaiting the original budget proposals from government agencies to find out which projects have been removed by the ministry of budget and management as a result of the transition to a cash-based budget system
before 2019.

According to Andaya, the legislators wanted to find the reason for the cuts in the proposed national spending program, especially for the DOH and the DepEd.

The DOH's Enhability program and the DepEd Fundamental Fund for Basic Services were cut by P30.3 billion and P69.4 billion respectively.

He noted that time is limited for establishing the national budget, such as the planned interruption of Congress in October and the need to present the proposed General Credit Act to President Duterte in November.

According to a cash-based budgeting system, all projects should be completed in one financial year. Projects that are "not ready for implementation" are removed from the proposed budget.

A commitment-based budgeting system, on the other hand, allows agencies to allocate funds for a project that can be exceeded for a year.

Due to the limitations of a cash-based system, the 2019 budget is in absolute terms P10 billion lower compared to the 2018 GAA, which reached P3,767 trillion.

The proposed national budget for 2019 is based on cash, in contrast to the traditional multi-annual obligations-based budgeting. The DBM said that the cash-based system is "more efficient" because it limits the rise of obligations and pays out payments for goods delivered and services provided, inspected and accepted within the fiscal year.

The obligation-based budgeting is the usual budget practice in the Philippines. It allows loans and commitments until the next fiscal year, which extends the validity of the funds to two years.


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