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Safeguarding the people’s money

It determines how and where government money — the people’s money — will be sourced and spent the following year. It is funded mainly by taxes and borrowings paid for by the people.

Benjamin Espiritu



Twenty-three years ago, on this very same day, 10 October, I wrote a column article entitled “The People’s Money.” I discussed this topic wanting to impress upon as many I could reach, as to who the responsibility for the people’s money ultimately lies. Today, I write about this again, because after over two decades, the message I wanted to give has not apparently been really internalized by the majority of the populace.
The national budget (General Appropriations Act) for fiscal year 2020, totaling P4.1 trillion, was approved by the House of Representatives on third reading last month. At the Senate, budget hearings are still ongoing.
At the local government level, in accordance with the Local Government Code, local chief executives must submit their proposed budgets for the coming year to their local Sanggunians (local legislative councils), not later than 16 October. Thus, before the end of the year, Congress and local government units should have enacted into law and ordinances, respectively, the national and local budgets for 2020.

It is also good to mention something which many may have not been paying attention to — the barangay budget. There are roughly 42,000 barangays in the country and all of them have their own budgets.

The budget is the most important annual piece of legislation enabling government to function. It determines how and where government money — the people’s money — will be sourced and spent the following year. It is funded mainly by taxes and borrowings paid for by the people.

Under our concept of governance, the people are the trustors who entrust their money to the trustees — the public officials. These public officials are in turn supposed to manage and use the money for the benefit of the owners — the people.

In a private business enterprise, particularly a stock corporation, a parallel situation occurs. The company’s stockholders entrust their funds and assets to the board of directors who, by law, exercise the corporate powers, conduct all business, and control all properties of the corporation. They formulate policy and undertake oversight. The board of directors in turn appoints the managers to run the day-to-day affairs of the company. These managers, for their part, are expected to manage the funds and assets judiciously, and earn a sufficient return on investment for the stockholders.

In the case of public funds, the “sufficient return” the people expect is the adequate delivery of basic public services. This means that the people’s money must not be squandered and/or stolen and must be spent on ensuring that the public receives the services due them from government.

The concept of stewardship is not unknown to many. However, a good number of people do not seem to really care to involve themselves in ensuring that the public funds which they own, the public debts which they pay for, are used and maximized for their benefit. So many people continuously complain about graft, but it not only continues but, in fact, increases.

Recently, the Deputy Ombudsman was quoted as saying that the Philippines is losing around P700 billion yearly due to corruption. He added that the said amount is equivalent to some 1.4 million housing for the poor, medical assistance for around seven million Filipinos, or a rice buffer stock that can last for more than a year.

The quoted figure talks of the amount lost to corruption. It does not talk about the amount lost to inefficiencies and other wastages. Due to the difficulty of discovering all the thievery, the waste and inefficiencies, we may never really get a precise figure on the total and actual misuse or theft of public funds. Suffice it to say that the total would be considerable.

The enactment of the national budget is a lengthy process. The Executive branch of government prepares the budget. Congress examines the budget and, together with the President, approves it. The government agencies, in turn, receive the funds and are accountable for them. The audit of the use of the funds is then undertaken by the Commission on Audit.

In the entire process, the people — trustor and owner of the funds and assets entrusted to the public officers — must take an active role. The taxes and debts the people pay are involved. Experience has shown that the people cannot leave everything to government. The owner of the money is the party that should have the greatest interest and the greatest say on how the money will be budgeted, managed and spent.

Consider again a parallel situation of a family investing their hard-earned money plus borrowings to invest in a business enterprise. Wouldn’t the family members, at every step of the way, move to protect their interest in the enterprise?

Ultimately, the people must assume the responsibility and burden of protecting public funds. We cannot rely solely on the honesty and competence of all government managers. If we could, then we would not be in our present situation wherein despite the taxes we pay and the public debts we contract, the citizenry does not exactly get the quality and quantity of public services it desires.

The involvement of the people in the budget process and the ultimate management of these funds can only be considered effective if the people internalize that:

First, the public budget is people’s money — their money.

Second, that they fund it through taxes they pay and debts they (and most probably their children) will ultimately pay for.

Third, that the public officers managing the funds are “trustees” whom they pay to do so.

Fourth, that the people study and learn what government officials should and should not do. Reading and internalizing the provisions of Republic Act 6713 (Code of Conduct and Ethical Standards for Public Officials and Employees), RA 3019 (Anti-Graft and Corrupt Practices Act) and RA 11032 (Ease of Doing Business and Efficient Government Service Delivery Act) would be a good start.

Finally, that the ultimate responsibility of safeguarding one’s money does not rest with the trustees or with the auditors. It rests with its owners — the people.

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