Budget Watch

ERC wants higher 2021 budget, says returns to gov’t could reach P200 billion

Aika Rey
ERC wants higher 2021 budget, says returns to gov’t could reach P200 billion
The Energy Regulatory Commission's proposed funds for 2021, approved by the budget department, amount to P543.8 million. It initially asked for P1.1 billion.

The Energy Regulatory Commission (ERC) is asking Congress for a higher 2021 budget, as the Department of Budget and Management (DBM) only approved close to half of what the agency had requested.

In the ERC’s budget hearing at the House of Representatives, Chairperson Agnes Devanadera said a billion-peso budget allocation could deliver about P200 billion of investments to the government.

“If ERC will be granted the budgetary items for consideration, then we will be able to attain – we are committed – to be able to deliver about P200 billion in investment. Not even a billion in investment in ERC as budgetary allocation, we will be able to deliver…by accelerating processing of applications,” Devanadera told lawmakers on Monday, September 7.

Among the ERC’s functions is to issue permits and licenses to electric industry firms.

According to Devanadera, the ERC has only 272 plantilla positions and therefore needs to hire job order (JO) and contract of services (COS) employees to get work done.

The proposed new appropriations for the ERC, as approved by the DBM, amount to P543.8 million. About P21 million will automatically go to the ERC as part of insurance premiums, bringing the proposed 2021 budget for the commission to a total of P564 million.

This amount, however, is only about 48% of the P1.1-billion budget that the ERC had requested from the DBM.

The commission’s proposed budget for next year is a 36% cut from current appropriations of P849.78 million. However, Devanadera said that about P312 million from this year’s funds had been discontinued due to the realignment provisions in the Bayanihan to Heal as One Act and the DBM’s belt-tightening circular for pandemic response.

It is unclear how much exactly is the adjusted ERC budget for this year, as the DBM has yet to disclose the adjusted department and agency budgets to the public.

“With the slash in the budget, not just on personnel services, but also on other items, there is a reduction in the available manpower, and, of course, the administrative part of it. There is a direct impact on the pace of processing of our documents,” Devanadera said.

For 2021, the bulk of the budget cut came from the ERC’s maintenance and other operating expenditures, where the commission sources its payment for JO and COS workers, as well as consultants. The DBM slashed 85.54% of the commission’s item for professional services – from this year’s P197 million to P28.55 million.

Capital outlay was also cut from P100 million to P13 million.

Now, the ERC is asking Congress for an increase of P405.9 million or a total budget of about P970 million. This would fund rent (P56 million), professional services (P228.65 million), and additional manpower (P22.3 million), among others.

“Without the CI (Congress-introduced increases), the ERC will not be able to transfer to another building. Right now, we cannot even allow our employees to go [to the office] – not even on [full skeleton force] – we just go on 30% to be able to observe physical distancing,” Devanadera said.

“We will not also be able to hire sufficient number of personnel to be able to deliver on our mandate. We will not be able to provide for consultancy services [for agencies being regulated],” she added.

After over 4 hours of interpellations, the House appropriations committee approved the ERC’s budget.

Some lawmakers who attended the hearing support a bigger ERC budget for next year.

“I just want to ask the committee to strongly consider increasing the budget. This increase has a corresponding revenue for the government of about P200 billion,” House Deputy Speaker Michael Romero said.

Romero backs the proposed higher budget of P970 million. This figure, however, may still change depending on the congressional deliberations. – Rappler.com

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Aika Rey

Aika Rey is a business reporter for Rappler. She covered the Senate of the Philippines before fully diving into numbers and companies. Got tips? Find her on Twitter at @reyaika or shoot her an email at aika.rey@rappler.com.