House, DBM okay hybrid budget

House Majority Leader Rolando Andaya yesterday confirmed that the Department of Budget and Management (DBM) and Congress are now on the same page in having a “hybrid budget system” for 2019.

Andaya told reporters he had a lunch meeting with House Committee on Appropriations Chairman Karlo Nograles, Budget Secretary Benjamin Diokno and Finance Secretary Carlos Dominguez III.

He said they, along with Executive Secretary Salvador Medialdea, have agreed to move past the clash between the executive and legislative departments on DBM’s proposed cash-based budgeting.

The House had stopped hearings with congressmen insisting on keeping the obligation-based budgeting, arguing that huge cuts will be implemented with the cash-based system.

But DBM insisted on cash-based budgeting to “force the agencies” to speed up project completion and actual use of allocated funds.

The cash-based budgeting limits payments to goods and services actually delivered and rendered during the fiscal year. The system purportedly forces fiscal discipline on implementing agencies.

Andaya said they will implement the hybrid budget system and will pass the 2019 budget for third reading on 12 October.

They have also agreed there will be no re-enacted budget and that they will return the slashed budget in some departments, he added.

The budgets for health, education and infrastructure were prioritized as per their agreement but they need to look for sources of the additional funds.

Andaya said they considered passing a supplemental budget for the referendum on the Bangsamoro Organic Law, but insofar as the internal revenue allotment and budget cuts, they still need to consult the Department of Finance.

“We discussed the effects and the bumps along the way when we fully implement cash-budgeting and we also agreed that the transition period cannot be one year. Two to three years transition period just to let the departments get used to it,” Andaya said.