DBM: General Appropriations Act reforms break ground for transparency, accountability

From the Department of Budget and Management

GAA-as-Release-Document regime kicks off

Greater efficiency and improved transparency in budget implementation and accountability in the expenditure process, and best of all, no more fake special allotment release order (SARO) scams: This is the Department of Budget and Management’s (DBM) battle cry for 2014, as the 2014 General Appropriations Act (GAA) takes effect on the first working day of the year, signaling a new regime—the first of its kind in the country’s governance history—that establishes the General Appropriations Act (GAA) as the government’s official budget release document.

Under the GAA-as-Release-Document budget regime, departments and agencies will no longer need to secure SAROs to obligate funds—which involves entering into contracts and kick-starting the procurement process—for a particular project. Instead, an agency can begin obligating funds as soon as the 2014 GAA is implemented on the very first working day of the fiscal year.

“The 2014 GAA, as signed by President Benigno S. Aquino III last December 20, already stands as the government’s primary budget release document. This means that all the disaggregated budget items in the GAA are already considered released to their respective agencies, with the exception of lump-sum funds that have yet to be itemized, and which will require prior approval before their release,” Secretary of Budget and Management Florencio “Butch” Abad said.

“The GAA-as-Release-Document regime is a huge departure from the longstanding practice of using SAROs and other release documents to move funds towards projects under various departments and agencies. By making the GAA as the release document for all budgetary items, we’ve practically eliminated the delays that have plagued fund releases, since agencies no longer have to secure SAROs and other release documents to obligate their funds. Instead, they can begin obligating funds as early as today: the first working day of the year, when the GAA officially takes effect,” he added.

As clarified by the Budget chief, some budgetary items will still require prior clearance and approval before the funds for these can be released to their respective agencies. These include lump-sum funds within an agency’s budget that have not been itemized prior to the approval and enactment of the 2014 GAA, as well as Special Purpose Funds, including Budgetary Support to Government Corporations.

Other budgetary items that will likewise need clearance prior to release are those with conditions and requirements specified under the 2014 GAA’s General/Special Provisions and Budget Affirmation/Veto Message in the GAA, and all automatically appropriated items, including Special Accounts in the General Fund.

Besides ramping up the speed and efficiency of fund releases, the GAA-as-Release-Document regime is expected to prevent or minimize irregularities in the release of public funds to agencies, such as those involving the circulation of fake SAROs.

“In 2013, we were made aware of a well-established and highly coordinated racket that centered on the dissemination of fake SAROs. We asked the National Bureau of Investigation to launch a probe into this, the official results of which we’re still waiting for. Altogether, however, it appears that unscrupulous individuals have taken advantage of the necessity of release documents so that these parties were able to profit from the distribution of fake SAROs.

“With the new GAA-as-Release-Document regime in place, however—and the fact that SAROs are no longer needed for many of the fund releases we’ll be making this year—we don’t just intend to accelerate releases so that they can properly fund our key programs and projects. We also mean to thwart those who’ve made the budget implementation process a hotbed of graft and corruption. This is part of our deliberate, focused campaign to facilitate greater transparency and accountability in the expenditure process, so that every peso spent by government will indeed benefit all Filipinos,” Abad said.

dbm.gov.ph

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