Bringing the 'public' back into 'Public Finance'

Mendoza and Melchor

We have come to this point because of the blatant distortions and corruption that pork barrel has created in our democracy. (Perhaps some small mercies from the present scandal.)

Academics and experts including Prof Tony La Viña of the Ateneo School of Government, Prof Edna Co of UP-NCPAG, and Prof Julio Teehankee of De La Salle University, as well as journalists including Malou Mangahas and Ed Lingao of the Philippine Center for Investigative Journalism (PCIJ), have for many years uncovered evidence and produced analyses on the detrimental features of pork barrel politics. Here we attempt to synthesize without necessarily implicating them:

Incidentally, some of these features are not necessarily limited to the pork barrel, which is just a shade over 1% of the total public sector budget. The pork barrel fiasco represents the tip of the proverbial iceberg as far as potential abuse of taxpayers’ money is concerned. Even as many public finance management features have changed in the last several years due to reforms like zero-based and performance-based budgeting (both geared to shave the excess fat and waste in the public sector), opportunities for abuse remain. The solutions must therefore address the abovementioned fundamental flaws, and hopefully extend throughout the public financial system itself.

Alternatives to pork

If we are to make a break from pork barrel politics, it’s important to understand the options and how these provide a different dynamic from what’s described above. The following presents a brief synthesis of recent proposals. 

Putting decision-making in the hands of the people

Incentivizing good governance, economic competitiveness and job creation

Freedom of information is the key ingredient

All these proposals significantly limit the discretion of politicians (notably legislators) from controlling pork. Approaches like bottom up budgeting and the people’s fund concept put decision-making in the hands of the people. On the other hand, access to challenge funds is premised on LGUs meeting certain conditions, which are in turn anchored on clear and measurable outcomes linked to policy objectives. Challenge funds provide a strong incentive for LGUs to gain access, and quite possibly also provide an equally compelling signal of good governance and economic competitiveness to the private sector as well.

By encouraging citizens to engage and setting incentives right, these proposals may also begin to enlighten citizens that taxpayers are financing these projects, and that politicians should not feel “entitled” to taxpayers’ resources (i.e. the second point mentioned above). Who knows, we might even arrive at better and more implementable laws when legislators only have to focus on their mandate?

However, when it comes to stopping politicians’ influence on the contracting and service provision process (the third point mentioned above), it appears that this area is still potentially vulnerable to abuse. Citizens, civil society groups and investigative journalists armed with information and evidence on these projects could help address this challenge. FOI (Freedom of Information) could be a critical ingredient in empowering transparency and accountability groups as watchdogs for these projects.

As elements of public finance reform in the broader sense (not just pork barrel moneys), these proposals will only work if we citizens engage in the design and implementation of the public budget. As Secretary Butch Abad of DBM noted, uncovering and exposing the present pork barrel scandal may actually turn out to be the best thing that has happened for public sector budgeting in this country, as citizens become better informed and more engaged with the government budget. - Rappler.com



The views herein are the authors’ and do not necessarily reflect those of the Asian Institute of Management (AIM). Questions and comments on this article could be addressed to: policycenter@aim.edu