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Looking Back: ABI 2006 – 2009
THE Alternative Budget Initiative, which is now
on its fourth year, was first implemented in
2006. Through the years, interventions expanded
and grew deeper with the rich experience and
learning gained within four years of initiating
participatory budgeting. The intervention now
includes engagement with the executive, budget
tracking, campaign for budget reforms, building
capacities of LGUs and local civil society
groups among others. Many agencies saw the
significance and impact of the campaign and also
extended support for the various interventions
within this initiative at the national and local
levels. Also, the ABI is presented in a number
of international events and globally recognized
as one of the best practices in budget advocacy.
Aside from the increases in allocations in the
national budget for MDG-related socioeconomic
programs, the Alternative Budget Initiative
campaign resulted to breakthroughs and
historical firsts in the Philippine budget
process:
a) Partnership of legislators and civil society
organizations in analyzing and critiquing the
budget; campaign for release of impounded funds
for MDGs; and efforts to push for Joint
Legislative Oversight on the Budget with civil
society participation
b) House Committee on Appropriations, for the
first time, conducted a hearing on alternative
budget proposals by civil society groups during
the first year of the ABI campaign (2007) and
has continued with this practice in 2008 and
2009
c) P5.3 billion increases in the budget for MDG-related
programs in education in the 2007 national
budget
d) P6.3 billion increases in the budget for MDG-related
programs for health, education, environment and
agriculture in the 2008 budget
e) P7.7 billion increases in the budget for MDG-related
programs for health, education, environment and
agriculture in the 2009 budget
f) Increased people’s participation in the
budget process: from 22 civil society groups in
2007 to more than 60 nongovernment and people’s
organizations in 2009; and built the capacities
of NGOs/POs to engage in the national and local
budget process and monitor budget
implementation.
g) Localizing participatory budgeting for the
MDGs (Ifugao, Albay, Pangasinan, Negros
Oriental, Mindanao Indigenous People’s Groups)
h) Monitored budget implementation and revealed
billions of unreleased funds for MDG programs on
health, education, environment and agriculture
in the 2008 and 2009 budget
i) Growing number of legislators, legislative
staff, and officers of legislature joining and
supporting the Alternative Budget Initiative
Campaign. Legislators are now using the
alternative budget documents (alternative budget
proposals, researches on MDG financing,
alternative sources of funding, and
presentations/analyses on the national budget)
during deliberations on the budgets of
implementing agencies as well as during
committee hearings and plenary sessions.
j) House Bill institutionalizing participation
of bona fide NGOs and POs in the national and
local budget process (similar bill was sponsored
in Senate)
k) Initiatives for budget reforms through bills
by legislators
l) Built partnership with the media and built
capabilities of media in reporting issues on the
national budget and calling for transparency and
accountability in the budget process Back to top
ABI’s lessons
from
2009 engagement
 Lesson
1: Proposing better allocations for
MDGs is only the first step. There has to be
strong civil society-legislator partnership in
monitoring the release and implementation of
these funds because the increases in the budget
for MDGs which were included in the General
Appropriations Act through the initiatives of
Senators and Congressmen are not being released,
are impounded, or are transferred to Overall
Savings and other budget items by the Executive.
Even the group’s initiative for Joint
Legislative Budget Oversight, which was endorsed
by the legislature, was not implemented.
Lesson
2: The advocacy should include
pushing for government to be resourceful in
terms of pooling financing for social
development in order to avoid problems on debts
and deficits which also burden the poor
population. An example of additional source of
financing for critical socioeconomic programs
are the so called “invisible budgets” or
possible sources of financing for social
development amounting to billions of pesos that
are not included in the national budget.
Examples are funds from the Motor Vehicles
Users’ Charge (MVUC) or the 50 percent
remittances required from Government Owned and
Controlled Corporations such as Pagcor. It is
also within the rights of legislature and civil
society has the right to monitor the
implementation and utilization of these
“invisible budgets” and call for the use of
these funds for MDG-related programs.
Lesson
3: The so-called “power of the purse”
of the legislature should be defended. First,
congressional initiatives in the budget are
subject to Presidential approval or impoundment.
Second, the Philippine budget system is designed
in a way where the legislature is not able to
scrutinized most of the national budget such as
automatic appropriations and special purpose
funds (SPF). For example, for the 2010 budget,
the Senate and House are going to review only
42.77 percent of the P1.5 trillion budget.
Comparing the 2009 and 2010 budgets, new
appropriations that Senate will act on together
with the House has been decreased by P3.7
billion. Automatic appropriations which will not
be acted on by both Houses are P123 billion
more. While SPF, which is directly managed by
the Office of the President, is P166 billion
more. Meanwhile, the budgets for departments
which actually deliver the services and which
the legislature scrutinize are allocated P51
billion less.
Lesson
4: There is a need to promote
participatory budgeting at the local level to
ensure financing especially for MDGs that the
country is in danger of not attaining because
financing gaps at the local level lead to uneven
progress on the MDGs among the regions.
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Looking Forward: ABI starts discussing 2010
strategies with Senators
 MEMBERS of the Alternative Budget Initiative
already started engaging at the Senate for the
legislators’ endorsement of the alternative
budget proposals for 2010. As the year ends,
this is also the opportunity for ABI to discuss
strategies on how to work for a more
participatory, transparent and accountable
budget process in 2010. After the meeting with
Senate Finance Committee Chair Edgardo Angara as
well as the successful
forum with heads and officers of Senate offices
and senior legislative staff, the group met with
Senators Pia Cayetano and Jinggoy Estrada.
Senator Cayetano said that the recent typhoons
and the Maguindanao massacre should serve as
eye-openers for legislators to really focus on
the alternative budget proposals for poverty
alleviation and the environment. She added that
the environmental disasters and worsening
poverty also opened eyes to the health risks
that are involved. Hence, legislators and civil
society groups should repeatedly call for the
release of impounded funds for health.
Meanwhile, Social Watch Lead Convenor Leonor
Magtolis Briones, said that the recommendation
of the United Nations when the economic crisis
hit many nations, was to focus on health and
education. The model was China which had a very
big economic stimulus fund but most of its funds
went to education and health.
Briones added that, in 2008, the thinking was
that the quick way to recovery is to pour a lot
of money and give conditional cash transfers so
that the people can have purchasing power. Now,
it is recognized that to be able to survive,
there is a need to invest in education and
health.
Aside from endorsing the alternative budget
proposals, Senator Cayetano also gave advice and
suggestions on strategies that the ABI can take
in 2010. This includes educating the new and
young Congressmen who are more progressive and
are more receptive on ideas of the budget
advocacy group. Moreover, she advised the group
to focus also on the campaign for the
legislators to concentrate on the bills on
budget reforms and to pass bills that will
protect their power of the purse. She raised
this suggestion after Briones discussed the fact
that Congress is only reviewing less than half
of the budget for 2010 because most of the
budget are Special Purpose Funds and Automatic
Appropriations.
She also said that she will help the group talk
to Presidentiables to make it an agenda to
ensure the release of funds that were included
in the budget through Congressional initiatives.
She also suggested that civil society groups and
the media can sign a petition against the
conditional veto wherein all realignment of
funds by the legislature will only be released
through the President’s approval.
She also emphasized the need to talk to the
Senate President, the Senators in the finance
committee and the House Appropriations Committee
on declaring some of the debts as onerous.
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 ISSUE BRIEFER:
Overall Savings
and Impounded
Funds
THE National Expenditure Program (NEP) contains
a section “Overall Savings” which reflects the
amount of net savings from the appropriations of
a particular year. Overall Savings is not
included in the NEP prior to FY 2005.
The Overall Savings is the result of budgetary
adjustments made by the Executive in the course
of the fiscal year. Specifically, it represents
the total amount transferred FROM various
departments/agencies and special purpose funds (SPFs)
NET of the transfers made TO
departments/agencies and SPFs.
The NEP for FY 2010 reports that the Overall
Savings for FY 2008 was P140.668 billion. This
amount is:
almost P34 billion more than the FY 2007
Overall Savings of P106.108 billion;
13.19 % of total New Appropriations of 2008
GAA which amounts to P1.066 trillion;
140 times more than the Overall Savings in FY
2003 of P1.006 billion;
Pooled savings (total transfers FROM) amount
to P178.728 billion while "total transfers to"
amount to P38.059 billion yielding a net Overall
Savings of P140 bilion.
.The Overall Savings being reported in the NEP
are not “savings” as defined in Sec. 60 (quoted
above) but more akin to impounded
appropriations. Section 67 of the General
Provisions of the 2008 GAA lays down the policy
against impoundment of appropriations.
“Prohibition Against Impoundment of
Appropriations. No appropriations authorized
under this Act shall be impounded through
deduction or retention, unless in accordance
with the rules and regulations to be issued by
the DBM: PROVIDED, That all the funds
appropriated for the purposes, programs,
projects, and activities authorized under this
Act, except those covered under the Unprogrammed
Fund, shall be released pursuant to Sec. 33 (3),
Chapter 5, Book VI of E.O. No. 292.”
Despite the prohibition against impoundment, it
appears that the Overall Savings represent
impounded of unreleased appropriations. During
the Round Table Discussion on Legislative Budget
Reforms , representatives of various departments
attested that the overall savings being reported
by the DBM are unreleased appropriations.
Department of Health (DOH) Usec. Villaverda in
particular pointed out that since these amounts
being reported are unreleased appropriations,
the department, in a sense, were not given the
opportunity to generate savings from these
appropriations. SWP and Prof. Diokno also raised
this issue of Overall Savings as impoundments
during the public hearing of the Senate
Committee on Finance on impoundment control
bills.
Also, The transfers made to various
departments/agencies and SPFs raises critical
issues. Article VI, Section 25 (5) of the
Constitution provides that:
“No law shall be passed authorizing any transfer
of appropriations; however, the President, the
President of the Senate, the Speaker of the
House of Representatives, the Chief Justice of
the Supreme Court, and the heads of
Constitutional Commissions may, by law, be
authorized to augment any item in the general
appropriations law for their respective offices
from savings in other items of their respective
appropriations.” (emphasis supplied)
Despite this provision, Section 59 of the
General Provisions of the 2008 GAA which sets
the policy for the use of savings, has modified
this, to wit:
“Sec. 59. Use of Savings. The President of the
Philippines, the Senate President, the Speaker
of the House of Representatives, the Chief
Justice of the Supreme Court, the Heads of
Constitutional Commissions enjoying fiscal
autonomy, and the Ombudsman are hereby
authorized to augment any item in this Act from
savings in other items of their respective
appropriations.” (emphasis supplied)
The modification has led to the questionable
practice of the President/DBM to transfer and
withhold appropriations to and from government
bodies which should have been off limits to the
President’s prerogative. Overall savings
contains transfers to and from bodies such as
the COA, COMELEC, CHR, Congress, CSC, the
Judiciary, and Office of the Ombudsman.
Further, COA raised the following concern in
accounting for overall savings:
“Non-documentation of fund transfers from one
department/agency to another. In this scenario
the DBM is allowed to pool savings of agencies
and has the authority to transfer said savings
to another agency. The problem is that the DBM
could not provide the appropriate documentation
where the savings came from or the agency whose
funds/savings where transferred to another
agency.”
COA further stressed that “documentation on the
sources of savings should be clearly indicated
by DBM for recording and monitoring of funds.”
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