A bold move

It took many by surprise, but last week’s announcement by Budget Secretary Florencio “Butch” Abad that the 2014 General Appropriations Act was already a comprehensive budget release document was actually years in the making. Buried in President Aquino’s “Budget Messages” in the last two years were expressions of the intent to streamline the budget process and at the same time eliminate the need for problematic Saros, or special allotment release orders. In other words, long before the Department of Budget and Management asked the National Bureau of Investigation to investigate the issuance of fake Saros, the policy direction was already clear.

President Aquino on July 24, 2012: “We want to establish a policy regime where the General Appropriations Act (GAA) serves as the release document. This will greatly minimize the tedious and repetitive process of releasing allotments, and avoid the delays due to bottlenecks from the back-and-forth movement of release requests.”

The President on July 23, 2013: “Last year, we announced the move toward a Budget-as-Release-Document Regime through the 2014 Budget. This regime promotes predictability and speed in budgetary releases, as well as in implementation, as the budgets of agencies—except for those that need prior clearance, to be contained in a negative list—are considered as released as soon as the Budget is enacted.”

Last Wednesday, that new release-document regime took effect. Filipinos of all political persuasions should welcome this bold move, as it promises to make government spending more efficient and less corrupt. We realize, of course, that the innate human capacity to adjust and adapt to changed circumstances applies equally to good and evil; in other words, we are aware that even a major reform of the budget process such as the new release-document system is not a guarantee of greater efficiency and radically reduced corruption. The human factor is a true constant.

But we share the view of those who see the budget reform as hope-inducing. Two quotes from Abad, included in the DBM news release announcing the change, are apropos and worth repeating in full.

“The 2014 GAA, as signed by President Benigno S. Aquino III last December 20, already stands as the government’s primary budget release document. This means that all the disaggregated budget items in the GAA are already considered released to their respective agencies, with the exception of lump-sum funds that have yet to be itemized, and which will require prior approval before their release.” While the lump-sum exception has always been part of the plan, Abad’s emphasis on it reflects the changed political landscape. It acknowledges growing public concern about the continuing use of lump-sum allocations in the budget, in the wake of the pork barrel scandal.

“In 2013, we were made aware of a well-established and highly coordinated racket that centered on the dissemination of fake Saros. We asked the National Bureau of Investigation to launch a probe into this, the official results of which we’re still waiting for. Altogether, however, it appears that unscrupulous individuals have taken advantage of the necessity of release documents so that these parties were able to profit from the distribution of fake Saros.” While the policy was always designed to eliminate “the bottlenecks from the back-and-forth of release requests,” in President Aquino’s words, Abad’s referencing of the fake Saro scandal is yet another reflection of the changed landscape.

We think the new release-document system is a bracing change. The budget becomes a lucrative source of political patronage and ultimately of corruption, in part because even approved items in the budget require special release orders. The new system eliminates the savvy political operator as a middleman.

But will the new release-document regime do away with the so-called paper trail? But in fact there are many items in the budget that are “not needing clearance.” In other words, the lack of a paper trail is not an issue; every government peso spent can theoretically be traced back to its original source. The real problem is human greed.