The Duterte Administration inherited over P1 trillion from the Aquino administration as budget for government departments and agencies. This ensures that enough funds are in store for any higher spending planned for the latter part of this year.
According to data from the Department of Budget and Management (DBM), notices of cash allocation (NCA) worth a total of P1.02 trillion was issued to government offices in the first half of 2016.
This amount is 49.28 percent of the P2.07 trillion budget allocated to departments plus special purpose funds mainly used for support state-run firms and local governments. This leaves a total of P1.05 trillion intact in the national treasury.
The 2016 budget, however, is P3.002 trillion. The balance worth P930.7 billion is in automatic appropriations billed for the payment of debts, grants and pension and donations.
Alvin Ang, an economist at the Ateneo de Manila University, commented on how Aquino’s admin left more money than former President Gloria Macapagal-Arroyo’s admin in 2010.
“Compared to 2010, they really have more money left now upon taking over. They should be proactive in disposing them,” Ang said.
NCA enables agencies to get checks from the Bureau of Treasury used for payment of contracted services. Funds are considered disbursed the moment checks are encashed.
P971.74 billion, or 95.7 percent of the P1.02 trillion NCA releases, were converted into checks.
Here’s the breakdown: P940.97 billion represents items redeemed as cash and spent. P30.77 billion stays as checks since June of this year, data showed. The balance amounting to P47.33 billion stays with agencies that did not, and have not, get checks for their services.
According to Ang, “The problem encountered by the previous administration was more of capacity by agencies to absorb the budget. That could be one reason why there is a lot of money remaining.”
To some observers, this may mean the Aquino administration didn’t do anything much in its 6-year term, hence its huge savings. However, Emilio Neri, Jr., Bank of the Philippine Islands lead economist, said that since January, there has been “big improvement.”
The DBM data said, NCA was used at a slower rate of 74 percent in January which, according to Neri, “is positive, especially for economic growth in the second quarter. Although, we are still looking at a slowdown in the second half as the new government adjusts,” according to a news report.
Neri added that, “There could be some review of projects and line agencies may have to deal with it.”
Meanwhile, the Duterte administration is aiming for a higher budget deficit amounting to 2.5 percent of the economic output in 2016. Originally, it was 2 percent. But Budget Secretary Benjamin Diokno had earlier mentioned how this is more due to a shortfall in revenues rather than bigger spending. He reminded that the budget had already been made or programmed.
However, Ang opined how the Duterte administration “may still encounter the same problems in budget absorption.”
How much Arroyo admin left for Aquino admin
In 2010, Aquino said that the budget for 2010 was P1.54 trillion.
However, Aquino revealed that Arroyo only left P100 billion, or 6.5 percent, of the budget for him to use for the rest of the six months left in the year.
He also hit Arroyo for using P1.4 billion of the calamity fund by the time her term ended on June 30, 2010, further disclosing that P108 million was poured into Pampanga, Arroyo’s home province, while only P5 million was given to Pangasinan after tropical storm Cosme.
Binay’s prediction of financially-crippled Duterte admin
Seeing as how there is more than 1 trillion left for the Duterte administration to use, this proves just how wrong former Vice President Jejomar Binay was in his prediction.
After the May 9 elections, Binay’s camp said that the Aquino admin was in a “mad rush” to spend leading up to the May 9 elections, which could leave Duterte “little room to work on” during his first year as President. They even came up with a figure, P496 billion, as what Aquino would turn over to the new administration, which is proven wrong with this recent report.