P22.46B supplemental budget okayed at committee level

MANILA, Philippines (2nd UPDATE) – Voting 10-2, the committe on appropriations of the House of Representatives on Tuesday, December 9, approved the P22.46 billion supplementary budget for 2014.  

This will fund pending payments for contractors of projects under the defunct Disbursement Acceleration Program and the abolished Priority Development Assistance Fund, and post-Typhoon Yolanda rehabilitation efforts. 

Representatives Antonio Tinio and Neri Colmenares voted against the bill, which was passed after only one committee hearing. 

The supplementary budget will still be subject to amendments when it undergoes 2nd reading in the plenary. Early on during the committee hearing, the Department of Budget and Management (DBM) manifested its intent to add more projects. 

Speaker Feliciano Belmonte Jr, however, told reporters he “discourages” this. 

Budget Secretary Florencio “Butch” Abad told the House appropriations committee on Tuesday, December 9, that the government found extra income from bond dividends after the supplementary bill was filed in Congress. This would increase the government’s extra income to P28.6 billion. 

The DBM is planning to use the additional funds to add more projects to the supplemental budget bill. These would be allocated to Yolanda rehabilitation and reconstruction, Abad said. 

Belmonte, in a separate press conference Tuesday, said it was the first time he was hearing about the proposal. The House and the DBM agreed on the P22.46 billion ceiling a week ago. 

“Remember this was P23 billion and we told them to study it carefully. They reduced it by P1.5 billion and removed the allocations for APEC. Now, just because they have found new money, they are going to increase it. I don’t think that’s right,” Belmonte said in a mix of English and Filipino. 

Ad hoc

During the committee hearing, Bayan Muna Representative Neri Colmenares also slammed what he said was the DBM’s “ad hoc” type of treating the supplemental budget. 

“Is it not a bit dangerous, this ad hoc type? Does it not go against principle of transparency?” he said.  

Of the 26 items in the proposed supplemental budget, 10 items are projects under the defunct Disbursement Acceleration Program (DAP), while one item is meant for projects under the Priority Development Assistance Fund (PDAF).  

The Supreme Court earlier declared certain acts under DAP unconstitutional, including the cross-border transfer of savings from the executive to the legislative branch. The entire PDAF system, meanwhile, was declared unconstitutional following exposés on how billions worth of funds under the system were misused. 

While the PDAF was abolished as early as 2013, Abad said the proposed funding would be for projects worth P1.85 billion that will be used to pay contractors and suppliers who have completed their work, but have not been paid prior to the SC decision on PDAF. 

The single biggest item in the supplemental budget is the P8-billion allocation for the construction of permanent housing for Typhoon Yolanda survivors under the National Housing Authority. Another P1.5 billion will be used for emergency shelter assistance under the Department of Social Welfare and Development.

Here’s the breakdown of the proposed projects as filed under House Bill House Bill (HB) 5237:

Government agency/GOCC/Special purpose fund	Project/program	Amount
1. Bureau of Treasury	Additional Capital Outlay and MOOE for the implementation of the Treasury Single Account	P803,380,000
2. Bureau of Treasury	Budgetary shortfall for Transaction fees and charges as a result of the implementation of the Treasury Single Account	P100,407,000
3. Department of Environment and Natural Resources	Hiring of new 294 former rebels as forest guards under the National Greening Program, as part of the joint peacebuilding effort of DENR and Office of the Presidential Adviser on the Peace Process	P11,176,000
4. Department of Finance – Office of the Secretary	Phase 2 of the Renovation of the DOF-OSEC Property	32,224,000
5. Department of the Interior and Local Government – Bureau of Fire Protection (DAP)	Transition Investment Support Plan – ARMM Procurement of 33 Firetrucks	P199,167,000
6. DILG – Office of the Secretary (DAP)	Operation Transformation Plan for the Philippine National Police	P2,833,282,000
7. Department of Justice (DAP)	Transfer of Quezon City Prosecutors and Public Attorney’s Offices	P5,200,000
8. Department of Science and Technology (DAP)	Digi E-fund – ICT hardware for government	P300,000,000
9. Department of Public Works and Highways (PDAF)	Obligations arising from implemented infrastructure projects before the Priority Development Assistance Fund (PDAF) was declared as unconstitutional	P1,849,150,00
10. Department of Public Works and Highways (DAP)	Completion of development assistance to the province of Quezon	P240,000,000
11. Department of Public Works and Highways	Construction of the new Bohol provincial capitol to replace condemned building	P350,000,000
12. Department of Public Works and Highways	Retrofitting of the Presidential Management Staff Office Building	P210,000,000
13. Department of Social Welfare and Development	Updating of the National Household Targeting System for Poverty Reduction	P1,942,521,000
14. Department of Social Welfare and Development	Emergency shelter assistance for victims of Typhoon Yolanda	P1,500,000,000
15. Department of Transportation and Communications – Office of the Secretary	Metro Rail Transit 3 Rehabilitation and Capacity Extension	P957,163,000
16. House of Representatives (DAP)	Completion of the Legislative Library and Archives Building/ Congress E-library	P250,000,000
17. Light Rail Transit Authority (DAP)	Rehabilitation of Light Rail Transit Line 1 and Line 2	P977,690,000
18. Mactan-Cebu International Airport Authority	Construction of Mactan-Cebu International Aiport VIP lounge building	P117,000,000
19. Metro Manila Development Authority	Closure of the San Mateo Sanitary Landfill	P178,000,000
20. National Electrification Adminsitration	Installation of 10 Megavolt Amperes Substation in Sto. Domingo, Albay	P32,600,000
21. National Housing Authority	Construction of permanent housing for victims of Typhoon Yolanda	P7,999,856,000
22. National Housing Authority (DAP)	Implementation of the North Triangle Relocation Project	P286,702,000
23. Philippine Coconut Authority (DAP)	Coconut Scale Insect Emergency Action Plan	P340,345,000
24. Philippine Fisheries Development Authority (DAP)	Construction of Fishport, lighthouses and seawalls	P196,385,000
25. Philippine Institute for Development Studies	Provision of rent of office space during pendency of construction of PIDS’ new building	P40,000,000
26. Supreme Court of the Philippines and the Lower Courts (deleted and realigned)	Enterprise information system plan of the Supreme Court	P715,360,000

Lawmakers decided to realign P715.36 million for the enterprise information system plan of the Supreme Court since the project has already been included the 2015 budget. 

The amount will instead go to emergency shelters under DSWD (P662 million) and pending PDAF payments under DPWH (P53 million). 

Tinio and Colmenares registered objections to the committee’s decision to realign the amount to PDAF projects. They said the entire amount should have gone to emergency shelters. 

During the hearing, lawmakers asked why the DBM failed to include the items in the supplemental budget in the 2015 budget, which is now under consideration by the bicameral conference committee. Congress aims to ratify the 2015 budget before the Christmas break. 

Abad said certain events superseded the submission of the budget proposal. He noted that the DAP decision was released in July, after DBM submitted the 2015 budget to Congress, while the rehabilitation plan for Typhoon Yolanda was approved only in October.  

Absorptive capacity

Some lawmakers, however, questioned the capability of government agencies to absorb the funds. One such agency is the NHA.  

Out of the 205,000 permanent housing units that the NHA needs to construct for Yolanda survivors, only 1,595 units have been completed to date, NHA General Manager Chito Cruz told the committee. 

The NHA targets to complete 3,000 units by December and 6,000 units by March – still way behind the 205,000 target. 

Cruz noted that P11 billion out of the initial funding of P13.4 billion for the first batch of units was given only in October.  

Even then, Colmenares said they would not have been able to use the funds since they are already way behind their deadline.  

Colmenares also questioned a possible “double entry” in the supplemental budget and the 2015 budget for LRT and MRT projects.

Under the supplemental budget, P978 million will be allocated for the rehabilitation of LRT, while P957 will be allocated for the MRT3 rehabilitation and capacity extension.  

Transportation and Communications Secretary Jun Abaya said the department had earlier weighed whether including the projects in the 2015 budget or the supplemental budget would aid the faster release of funds given the “urgency of the projects.” 

Abaya admitted the Department of Transportation and Communications (DOTC) decided to include the appropriations in the 2015 budget. 

Colmenares criticized how the DOTC is handling the budget process. 

“DOTC will submit a new list just to fill up for this. This is a very strange way of double entry just in case the supplemental budget is passed first,” Colmenares said.  

Asked why the same items were included in the supplemental budget, Abaya said the DOTC will instead submit a new list of projects to be funded. He also gave assurances the new projects will not be similar to what was included in the 2015 budget. – Rappler.com