Philippine

Realization of budgeting
theories and actual budget
techniques
 The President budget message

 Organizational performance
indicator framework
 Philippine
s

INTRODUCTION
The national budget describes how a government intends
to spend money. It provides a summary of various macro- and
micro-decisions, as well as a clear reflection of an administration’s
desired trajectory, expressed in its fiscal priorities. During his State
of the Nation Address (SONA) on July 24, 2018, President Rodrigo
Duterte submitted his proposed 2018 Budget to Congress. Five
months later, after months of8 deliberations in the Lower and
Upper Chambers of Congress, the 2018 General Appropriations
Act — the first financial blueprint fully put together by the
Duterte administration — was passed and signed into law in
December 2017.

In President Duterte’s Budget Veto Message (Duterte,

2017), he promised to usher in a “golden age of infrastructure,”
secure peace and order, and accelerate human capital
development for sustained and inclusive growth through the
administration’s Php 3.767 trillion expenditure plan. He
committed to use the budget to bring about genuine and lasting
change by reducing inequality, enhancing the social fabric,
increasing growth potential, providing an enabling and supportive
environment, and maintaining the groundwork for sustainable
development.
 A BUDGET THAT REFORMS
AND TRANSFORMS
T he National Budget for 2018 was crafted with the primary objective of bringing about a positive
transformation through the implementation of successful reforms. As the country moves toward
the achievement of providing a matatag, maginhawa, at panatag na buhay for the Filipino people,
this Budget aims to lay strong foundations for real and lasting change that will benefit ALL,
especially the future generations

Credible and Disciplined Fiscal Policy

A fiscal framework based on credible and disciplined policies guarantees
long-term fiscal sustainability and predictability.

Expansionary Fiscal Policy for Inclusive Growth

The key to sustaining the country’s growth momentum is to ensure that our limited resources—from improved revenue
collections and sustainable borrowings—are directed to the country’s strategic priorities, while managing low inflation and debt-
levels. For the next five years, the government will maintain the budget deficit at 3% of GDP, while at the same time
reducing the size of debt in the context of the country’s GDP through improved revenue collections.
Addressing Underspending through the One-Year Validity of Appropriations
A turning point in the country’s budget system was Congress’ approval of the one-year validity of appropriations in the 2018
Budget. Although the 2017 Budget started the obligation of allocations within the fiscal year (FY), starting 2018, all funds will be
available for release and obligation only within the FY.

This change is in preparation for the full implementation of the Cash-Based Budgeting System in 2019. This new System of
releasing funds to agencies seeks to address underspending by ensuring that the budget will be fully implemented within the
FY. It speeds up the execution of the budget and allows a more prompt delivery of goods and services and payment of the
same. Greater discipline will also be imposed on the agencies in managing their funds, thereby enabling them to provide better
public services to the people.

Fiscal Space Focused on Equitable Progress

and
Social Order
Golden Age of Infrastructure Uplifting the Marginalized
A budget of PhP1,068.4 billion has been allocated for As lifting the poor from poverty is a priority of the
the “Build, Build, Build” Program in 2018 to accelerate government, the Social Services Sector receives a budget
strategic infrastructure and ensure sustainable of PhP1,425.7 billion, representing 37.9% of the 2018
development. Budget.
The Build, Build, Build Program is allotted as follows: Key items under the
PhP 760.2 Social Services Sector are:
- Education
B - Health
PhP 148.0 B - Luzon
PhP 179.4 - Social Security, Welfare, and
PhP 62.3 B - Visayas B Employment
PhP 85.8 B - PhP 284.1 - Housing
2 2018 PEOPLE’S Mindanao B
BUDGET PhP 5.9
B
 A Budget Reflecting the Administration’s
Policies
The shift to the Program Expenditure Classification (PREXC) system of presenting the budget establishes a better link
between planning and budgeting and provides performance information that would improve the understanding and
appreciation of the
purpose of the expenditure and its intended beneficiaries.

FRO NEW CHANGES WITH PREXC T

M
Outcome Indicators at organizational Outcome PerformanceO
Indicators at program
level level
Major Final Output (MFO) Program/Sub-program outcome and output targets
targets Projects (PAPs) under Activities and Projects under
Programs, Activities,
Operations Operations grouped by Program/Sub-
grouped by MFO program

Strengthening Transparency, Participation, and

Accountability
The government continues to engage the public in the budget
process, thus upholding the citizen’s right to participate in
Freedom of Information governance. Open Budget Index (OBI)
Under the Freedom of Information (FOI) program, information Based on the results of the Open Budget Survey (OBS) 2017, the
on 218* government agencies can also be accessed by the Philippines now ranks first in Asia in terms of budget transparency.
public on eFOI (www.foi.gov.ph). The country’s OBI score of 67, three notches up from its score
*As of February 6, 2018
of 64 in the OBS 2015, is significantly higher than the global
Open Government Partnership average of 42.
The Duterte Administration continues to intensify the
implementation of the 2017-2019 Philippine Open Government
Philippines’ OBI score, 2006-2017
Extensive
Partnership (PH-OGP) National Action Plan. This 2018, a 51 48 55 48 64
100

67
mid-term progress report on its implementation will be Substantial 80

released to assess the extent of the government’s

Limited 60
collaboration with civil society organizations in delivering its
open governance commitments. Minimal 40

A series of regional dialogues will be conducted nationwide Scant o r N o n e 20

from January to March 2018 in order to disseminate 0

information on the OGP and other participatory governance 2006 2008 2010 2012 2015 2017

initatives of the Administration.

Enhancing Partnerships with Local Governments to Ensure Sustainable

Development
Local government units (LGUs) are Conditional Matching Grant to Assistance to Municipalities
the frontline service providers to the PhP8.5 billion to repair, rehabilitate, and
Provinces PhP11.9 billion to assist municipal
people. Thus, engaging them in the provincial roads across the country in order to
improve governments in building basic facilities for the
implementation of programs is a boost the competency of provinces in local citizens, while also increasing their
roads
managemen participation in local governance.
strategic way of achieving the
t. Assistance to Cities
country’s development goals.
Sagana at Ligtas na Tubig para sa PhP2.6 billion to fund the establishment and
(SALINTUBIG
Lahat enhancement of eco-friendly infrastructures,
PhP31.4 B P
) hP1.4 billion to provide safe and clean such as forest parks, botanical gardens, and
for the Local Government Support supply systems to waterless municipalities
water bike lanes, among others.
Fund nationwide. For 2018, it targets to complete
projects in 80 municipalities, 171 barangays,
DEPARTMENT OF BUDGET A N D MANAG EM EN T
and
8 resettlement
3
sites.
THE BUDGET AND THE ECONOMY

A s the economy affects the government’s fiscal policies and

actions (e.g., tax and spending decisions), the 2018 Budget carefully
considers the following key macroeconomic indicators:

Fiscal Sensitivity to Key Macroeconomic Indicators,

2016-2018
(in billion Pesos per annum)

Philip
pines

Particular Revenu Disbursements Budget Balance2/

s1/ es
2016 2017 2018 2016 2017 2018 2016 2017 2018

1 percentage point increase

in real GDP growth 21.6 19.3 21.4 – – – 21.6 19.3 21.4

1 percentage point increase

in inflation rate 20.8 18.4 20.7 – – – 20.8 18.4 20.7

1 percentage point increase

in merchandise imports 4.3 3.7 4.2 – – – 4.3 3.7 4.2
1 percentage point
increase in interest 0.6 0.5 1.0 3.2 3.2 2.0 (2.6) (2.7) (1.0)
rates
1 percentage point
increase in London
Interbank Offered Rates – – – 4.2 4.6 5.3 (4.2) (4.6) (5.3)
(180 Days)
1 Peso depreciation in
foreign exchange rate 10.5 9.2 9.5 2.1 2.0 2.1 8.4 7.2 7.4
1/
For the definition of these indicators, please refer to the Glossary of Terms on p.
43.
2/
A negative figure in the budget balance means an increase in deficit.

DEPDEPARTMENTARTMENT OFOF BUDGETBUDGET ANDAND

M
A
N
G
M
EM
N
E
T
A
N
GM
E
N
E
T 1
3
13
THE FISCAL PROGRAM

T o support the country’s sustained growth momentum and fund the

government’s expenditure priorities, the Duterte Administration continues its
sustainable expansionary fiscal policy — ensuring that revenues are improved
while the size of debt as a percentage of GDP is reduced.

The Fiscal Program

6,000
2016-20221/ (in 5,148.
billion Pesos) 7
5,000 4,621
.6
4,160
.7
4,000 3,708 4,387.
.3 7
3,312.6 3,929
.4
3,530.
3,000 2,823.
2,549. 3,133.8 3
8
3
2,788
.9
2,000 2,473
2,195 .1
.9

1,000 574. 630. 692. 761.

523. 2 0
350. 5 4
353. 7
7
DISBURSEMEN 4
TS REVENUES 0

DEFICIT
2016 2017 2018 2019 2020 2021 2022
REVENUES
T
o sustain the government’s massive investments in public infrastructure and social
services,is the
Budget supported
2018 by an increasing level of revenues, from PhP2.388 trillion in 2017 to
PhP2.789
trillion in 2018. As a share of GDP, this represents 15.9% from only
15.7% in 2017.
Revenue
20 Performance
15.
9
15. 15.
15. 5
1 7
2
5
12.
12. 8
1 6
0 9.
8
LEGEND:
As % of GDP with TRAIN
5 As % of GDP without
4. TRAIN Growth Rate
1 with TRAIN
0 Growth Rate without
201 201 201 TRAIN
6 7 8

Total Revenues
PhP2.789 T*
What are
BIR the
PhP2,025.4 sources
B
of
BOC government
Tax Revenues PhP577.9
B
revenues
PhP2,620.1 B
for 2018?
Other PhP16.8
s B

BTr
PhP55.8
B

Non-Tax Fees and

Revenues Charges Of the PhP2.789 trillion total revenues for 2018,
PhP47.1 B PhP2.62 trillion, or 93.9% comes from taxes.
PhP166.8 B
Non- tax revenues, on the other hand,
Others contribute PhP166.8 billion, while an additional
Other PhP64.0
s PhP2.0 billion is expected to be raised from the
B proceeds from privatization. The total revenues
Sal
e.g., real for 2018 already considered the expected
Revenues properties
from
e
owned by the old revenues from the Tax Reform for Inclusion and
of
Privatization Asse
central bank Acceleration (TRAIN) Program, including the
PhP2.0 B ts PhP2.0 B impact of the lowering of personal income taxes.
6 2018 PEOPLE’S

BUDGET
2 0 1 8 BUDGET DIMENSIONS
BY FUNCTION/SECTOR

2018: PhP1,378.7 B

(36.6%)*
General Public
Services
for general expenditures
This represents
administration such
management, foreign affairs
as lawmaking,
governance,
fiscal and ,
Phi l i ppi n
es
regulatory services. othe
r
Economic Affairs
This includes the
2018: allocations
for the
PhP693.0 B activities
government’s promot
(18.4%) economi
that e
* competitivenes growt
s
industries, and job h,
creation. of

Public Order and

Safety This includes
allocations for police and
fire protection services,
2018: law courts, and prisons.
PhP195.4 B
(5.2%)
*

Defense
This includes military
defense, foreign military aid,
civil defense, and defense
against cybercrimes, among
others.
2018: PhP127.4 B
Recreation,
(3.4%)* Culture and
Religion
These are
recreation
expendituresandfor services
Figures may not add up due to rounding
1/ culture,
sports,
focused onpublishing,
off and religion, among
* Percentage share of the total budget others.

2018:
8 2018 PEOPLE’S
E’S PhP6.6 B
BUDGET
B
(0.2%)
*
 Government expenditures can be classified using the
Classification of the Functions of Government (COFOG)
which looks at the detailed functions of agencies. Unlike
the old system, COFOG takes into consideration the nature
of expenditure of the agency rather than its contribution to
the sector where the agency belongs. It identifies 10 sectors
or functions
namely: (1) of government,
General Public Services, (2) Defense, (3) Public
2
e=m
c 2018: Order
and Safety, (4) Economic Affairs, (5) Environmental
Protection,
(6) Housing and Community Amenities, (7) Education, (8)
PhP705.8 B
Health, (9) Social Protection, and (10) Recreation, Culture,
Education (18.7%)*
and
Religion. The first five sectors benefit the entire society
This covers pre-primary and while
the last five are focused on individuals, most especially the
primary education, marginalized
secondary and tertiary .
education, and school COFOG enables the government to compare and report data
buildings, among others. on expenditures across countries adopting the same
functional
classifications
.

Social 2018:
This refers to government
Protection PhP458.7 B
welfare spending that (12.2%)*
protects
individuals from loss
interruption of income and
or
for special expenditures due
to birth, marriage, or death.

Health
This covers expenditures
for hospitals, outpatient
and public health
services, health
research and
2018: PhP172.8 B
development on health.
(4.6%)
*

Environmen
tal
Protection
This covers expenditures for
waste management, pollution
control and abatement,
landscape,
protection ofamong othes.and
biodiversity
Housing and
Community 2018:
Amenities PhP22.6 B
These are housing benefits
and provisions for community (0.6%)*
amenities such as potable
water supply and street
lighting.

2018:
PhP6.1 B DEPARTMENT OF BUDGET A N D MANAG EM EN T 9
(0.2%)
*
 2 0 1 8 BUDGET DIMENSIONS
The sectoral allocation of the 2018 Budget clearly reflects the priorities
of the Duterte Administration. Social Services corners the largest
share at 37.8% or PhP1,425.7 billion. This increases the access to
quality social protection programs and public services such as
education, health, housing, and employment. The share of economic
services, on the other
hand, further expands to 30.6% from 27.5% in 2017, consistent with
the government’s massive infrastructure program dubbed Build,
Build, Build.

PhP3,767 B
Debt burden, as a share of
e=m
2 the total budget, continues to
c Philippines
decline from 10.5% in 2017
to only 9.8% for 2018,
thereby increasing the
resources for priority
expenditures.

DEB
T
Social Economic General
2016 2017 2018

Services Services Public

PhP1,425.7 PhP1,153.6 B Debt Defense
Services Burden PhP161.5
B 37.8% 30.6% PhP655.4 B PhP370.8 B 4.3%
17.4% B 9.8%
As % of the Budget, 2016-2018
2 0 1 8 BUDGET DIMENSIONS
BY RECIPIENT UNIT

F or 2018, national government agencies (NGAs) receive PhP2,634.2 billion, representing 69.9% of the 2018
and a 14.5% increase from last year’s
Budget
budget.
Subsidy to GOCCs, amounts to PhP197.6 billion, or 27.6% higher compared to its level of PhP154.9 billion in 2017.
The bulk of the increase is attributed to the: a) implementation of the targeted cash transfer program for poor
families through the Landbank to cushion the inflationary impact of the TRAIN Program; b) increased coverage of
senior citizens from six months to one year by the Philippine Health Insurance Corporation (PhilHealth); and c)
subsidy for the Public Utility Vehicle (PUV) Modernization Program.

The support to local government units (LGUs) represents 15.4%, or PhP581.2 billion, of the budget, which is
3.8% higher than the PhP560.0 billion allocation in 2017. The largest component of this is the PhP522.7 billion
Internal Revenue Allotment (IRA).

Budget by Recipient Unit,

2016-2018
201 201 201
6 7 8

NGAs PhP1,991.4 PhP2,300.1 PhP2,634.2

B B B
GOCCs PhP131.7 PhP154.9 PhP197.6
B B B
LGUs PhP485.8 PhP560.0 PhP581.2
B B B
Creditors PhP392.8 PhP334.9 PhP392.8
B B B

TOP 10
RECIPIENTS

1 Department
of
Education
2 Department
of Public
3 Department
the
of Interior
4 Departme
ntof
5 Departme
nt of
Works and andLocal Health National
(including PhP167.9 B
CHED, TESDA) Highways Government Defense
PhP637.9 B PhP170.8 B PhP149.7 B
PhP672.4 B

6 Department
of Social
7 Department
of
8 Department
of Agriculture
9 Autonomo
Region
us in
10 Departme
ofnt
Welfare
and Transportati
PhP66.3 Muslim
Mindana Environment
and Natural
PhP53.5
Development
PhP 41.8 onB B o Resources
1 B PhP33.1 B PhP24.9 B
 FULFILLMENT OF THE PRESIDENT’S
PROMISES
The 2018 Budget represents the fulfillment of the
campaign promises of President Duterte.

I. Universal Access to Quality Tertiary

Education
Through the 2018 Budget, the Administration addresses the disparities in educational opportunities and access to
quality higher education through the Universal Access to Quality Tertiary Education (UAQTE) Program.
PhP40.0 B
For the UAQTE to provide free tuition for college students
in State Universities and Colleges and more (see details below)

Free Tuition 2017 vs UAQTE

20181/
Free Higher Education
FY Free tuition for all courses/subjects/classes in
2017 SUCs and LUCs2/, including free miscellaneous
P

and other school fees defined by law

Universal Access to
Free Technical and Vocational
Quality Tertiary
8.3 B Education and Training
Education 2018 Free training and training-related expenses:
P living allowance, starter toolkit, cost of
accreditation
P

Free FY
tuition in 2018 Tertiary Education Subsidy
Tuition and other fees for private HEIs,
SUCs only including other educational expenses3/

1/
Source: Commission on Higher Education 40.0 B
and Department of Budget and
Management 2/Local Universities and P Student Loan Program
Colleges
3/
Subsidy is equivalent to the tuition and P P
P
Loan proceeds for educational
other school fees of the nearest SUC or P

purposes
state- run Technical Vocational Institute in
their respective areas

II. Doubling the Salaries of Military and Uniformed

Personnel
With the approval by Congress of Joint Resolution No. 1on January 1, 2018, President Duterte fulfilled his promise of increasing
the base pay of military and uniformed personnel (MUP) estimated to cost PhP64.2 B.

Provision of Hazard
Pay
PhP540/month
Average raise for all MUP
100% increase in monthly ranks
base pay For Police Officer I , Fire/Jail
Officer I, Private, and Apprentice 2018: 58.7%
The first round of increases
2019: 72.2%has been effective
Seaman
since January 1, 2018. The second round has
PhP14,834 been effective since January 1, 2019.
PhP29,668
 III. Free Irrigation Services for All
The 2018 Budget ensures the fulfillment of the President’s commitment to provide free irrigation for
small farmers.

For the National Irrigation Administration (NIA) to ensure

PhP41.7 the development, restoration, repair, and rehabilitation of
climate-resilient irrigation systems nationwide
B
Free Irrigation Service Act
On February 2, 2018, the President signed Republic Act No. 10969, or the Free Irrigation Service Act,
which exempts farmers who own eight (8) hectares of land or less from paying irrigation service fees
(ISF). The Law also condones the unpaid ISFs and the corresponding penalties on loans of farmers with
the National Irrigation Administration.

Subsidy for Irrigation Service

Targets Fees

P
Percentage increase in the number of To cover the
farmer beneficiaries with increased cost of free
productivity 2.0 B irrigation
2018: 50% P services for
2017: 20% farmers
No. of hectares irrigated in all cropping
seasons
For national irrigation systems
2018: 1,205,557
ha2017: 1,135,747 ha
For communal irrigation
systems
2018: 1,316,753
ha 2017: 1,149,164 ha
National irrigation systems are large and medium schemes
operated and maintained by the NIA, while communal irrigation
systems are small-scale schemes and constructed with the
participation of farmer-beneficiaries through the irrigation
associations.
No. of hectares of new service areas
developed
2018: 18,447
ha2017: 16,562
ha

IV. Marawi Rehabilitation and Recovery

Program*
To reconstruct damaged houses and
infrastructure and address the needs of
465,674 individuals displaced by the war
2018:
in Marawi PhP10.0 B
2017: PhP5.0 B
*To be sourced from the PhP25.5 billion NDRRM
Fund

DEPARTMENT OF BUDGET A N D MANAG EM EN T 17

 INEQUALITY-REDUCING TRANSFORMATION
ACCELERATING HUMAN CAPITAL DEVELOPMENT:
QUALITY, ACCESSIBLE, AND RELEVANT EDUCATION

E ducation is the wealth of every nation. As skilled, mobile human capital is

considered
one of the main drivers of development and economic growth, the
continues to invest in programs, projects, and activities that will make
government
education
accessible to every Filipino. The Education Sector is given some PhP672.4
billion for 2018, 2.4% increase from the 2017 budget of PhP656.3 billion.

BASIC EDUCATION
Primary and secondary education aim to give children a strong foundation for developing their skills and abilities. For
2018, the Department of Education (DepEd) has been allocated a budget of PhP580.6 billion.

2018 Targets of the

DepEd
Net Enrolment Rate Completion Rate
The number of students in the theoretical age group for a given is the percentage of students who have completed an
education level as a percentage of the total number of population education level in the required number of years of study.
in that age group.

83.43 86.25
% 73.97 % 77.15
% %

Kindergarten Junior High

Elementary School

74.65% 83.37% 91.05% 92.74% 68.15% 71.27% Baseline 2018

Baseline (2015) 2018 Target (2015) Target
Elementary
Junior High
School

Basic Educational Facilities Manpower Learning Resources

• Construction of 28,170 classrooms • Creation of 81,100 teaching • 34.68 million books
• Procurement of 81,201 sets of school positions (K-to-10 program: • 3,740 Science and Mathematics
seats 78,924; Special equipment
• Repair and rehabilitation of Education: 1,944; Senior High • 4,000 e-textbook packages
6,800 classrooms School: 232) • 18,969 Technical-Vocational Tools and
• Creation of 140 non-teaching Equipment
positions Government Assistance and
Health and Nutrition Services
Benefits for Students and
PhP5.3 billion for the school-based
Teachers
Feeding Program. This will benefit:
• 1.8 million severely wasted and wasted P P
PhP26.3 billion to provide financial aid to:
• 2,327,687 students
P

students (those with low weight in relation to

P

height) • 41,659 teachers participating in the Teacher

Salary Subsidy Program
18 2018 PEOPLE’S

BUDGET
 INEQUALITY-REDUCING TRANSFORMATION
ACCELERATING HUMAN CAPITAL DEVELOPMENT:
HEALTH FOR ALL

G ood health is a key factor in the development of every citizen’s full

and productivity. Thus, the government continues its efforts in ensuring
potential
that
all its citizens, especially those from low income families, have access
qualityto
health
the services that they
need.
For 2018, a budget of PhP179.4 billion is provided for the Health Sector, a
13.3% increase from the 2017 budget of PhP158.3 billion. PhP109.8 billion of
this total goes to the Department of Health (DOH) for the following
programs:

National Health Insurance National Immunization

Program Program
PhP60.6 billion to provide affordable PhP7.4 billion to fund the following:
• Pneumococcal vaccinations for infants
and accessible health insurance for:
and
•15.4 M poor families (PhP2,400/family) senior citizens
P P
•5.4 M senior citizens (PhP3,120/senior • Full immunization of 2.7 million infants
P
P
citizen) against hepatitis B, measles, rubella,
•25,514 families under the PAyapa at polio, Japanese encephalitis, etc.
MAsaganang PamayaNAn (PAMANA) • Immunization of Grades 1 to 7
Program (PhP2,400/family) students against measles, rubella,
•22,709 beneficiaries under the tetanus, and diphtheria
Bangsamoro Program (PhP2,400/family) • Immunization of pregnant women
against tetanus and diphtheria
Human Resources for
Health Deployment Prevention and
Program Control of
PhP10.0 billion to address the need for more health
Infectious Diseases
personnel in far-flung or hard-to-reach communities. This
Program targets to achieve a ratio of 17 Human Resources PhP2.9 billion to provide prevention
for Health (HRH) per 10,000 population this year by hiring services, testing, and treatment of infectious
the following: diseases such as dengue, malaria,
schistosomiasis, leprosy, filariasis, and
446 3,108 HIV/AIDS, among others
docto midwiv
rs es Tuberculosis Control
Program
20,52 324 PhP785 million to ensure a 90% TB
7 dentis case detection rate and TB treatment success
nurse ts rate, and reduce TB incidence to 225 per
100,000 in 2022
s from 322 in 2015

20 2018 PEOPLE’S

BUDGET
 INEQUALITY-REDUCING TRANSFORMATION
REDUCING THE VULNERABILITY OF INDIVIDUALS
AND FAMILIES

T he sectors that are most vulnerable to economic shocks are also

the groups
with
women
the highest incidence of poverty, namely, children (34.1%),
(22.5%), and senior citizens (13.2%). The Duterte Administration
a premium
puts on providing benefits to these targetted Filipino individuals and
households to help them cope with circumstances that threaten their
welfare.

Reflecting the government’s commitment to provide social protection to these groups, the
Department of Social and Welfare Development (DSWD) has been allotted a 2018 budget of
PhP142 billion, an increase of 10.59% from the 2017 budget of PhP128.4 billion.

Protection for the

Poor

Conditional Cash Sustainable Kalahi-CIDSS National

Transfer (CCT) Livelihood Community-Driven
Program Program Development
PhP89.4 billion to provide Program
educational grants, livelihood PhP5.1 billion for poor
assistance, and health services to: households to develop their PhP5.4 billion to involve
• 4.4 million poor entrepreneurial and labor skills. communities in local government
families For 2018, this program will help: planning and budgeting to enhance
(Regular CCT) • 153,551 beneficiaries their access to public services. It
• 235,289 beneficiaries targets to complete 2,705 sub-
(Modified CCT) projects in 5,551 barangays
across 15 regions in 2018.
22 2018 PEOPLE’S

BUDGET
 INEQUALITY-REDUCING TRANSFORMATION
EXPANDING OPPORTUNITIES I N AGRICULTURE,
FORESTRY, AND FISHERIES

Poverty Incidence of Farmers and Fisherfolk

W
2012 2015
ith a budget of PhP103.5
billion for the Agriculture,
Forestry, and Fisheries Fishermen 39.2
Sector, the Duterte Administration 34.0
(AFF) Farme 38. 34.
stays committed to uplift the lives of
farmers and fisherfolk who are among rs 3 3
the poorest in the country.

To revitalize the country’s agricultural sector, the Department of Agriculture (DA) is

Reduce Hunger provided a higher budget of PhP59.8 billion1 to help feed more than 100 million
Filipinos.
1
Per GAA inclusive of Government-Owned and/or -Controlled Corporations
(GOCCs)

Agricultural Commodity Programs

Rice Program = PhP11.8 B High Value Crops Program = PhP3.6

Increase rice yield to 19.79 million B
metric tons (MMT) Raise investments
Banana in high value commercial
Coffee
2017: PhP9.7 B 18.57 MMT crops
2018: 9.926 2018: 0.052
Corn Program = PhP3.0 B MMT MMT
Expand production of yellow corn 2017: 9.64 MMT 2017: 0.044 MMT
to 8.87 MMT Cacao Pineapple
2017: PhP2.8 B 8.45 MMT 2018: 0.027 2018: 2.822
MMT MMT
2017: 0.019 MMT 2017: 2.74 MMT
Fisheries Program = PhP4.6 B Mango Rubber
Increase the production of fish and other aquatic 2018: 0.986 2018: 0.262
produce
MMT MMT
2017: 0.96 MMT 2017: 0.23 MMT
1.06 201
Commerci
MMT 8
al Livestock Program = PhP2.7 B
1.04 2017 Provide a competitive alternate source of income through
MMT
1.15 201
Municip
al MMT 8
1.14 2017
2.42
MMT 201
Aquacultur MMT 8
e
2.31 2017
MMT

National Food Authority = PhP7.0 B

388,889 metric
Ensure the availability of rice especially during lean
seasons through the Buffer Stocking Program tons
of palay to be
24 2018 PEOPLE’S procured
BUDGET
 INEQUALITY-REDUCING TRANSFORMATION
EXPANDING ECONOMIC OPPORTUNITIES
I N INDUSTRY AND SERVICES

T he Industry and Services Sectors remain the drivers of economic growth. With
the
current labor force participation rate of 60.6%1, more than half, or 77.4% of the
employed Filipinos, are working in these two sectors. Moreover, among the
major
sectors in the country, Industry and Services had the fastest growth in 2017, with
7.2% and 6.7%, respectively.

With a budget of PhP6.0 billion in 2018, a 25% increase from its 2017 allocation of
PhP4.8 billion, the Department of Trade and Industry (DTI) will continue developing
micro, small, and medium enterprises (MSMEs) to sustain the country’s inclusive
growth. This will be achieved through:

As of July 2017
1

Establishment of Negosyo Centers

2018: PhP515 million

To promote the ease of doing business in the country through the establishment of
more Negosyo Centers, which serve as one-stop shop facilities for the processing
of requirements and registration of businesses

Particulars 2018 Targets

2017 Targets

Number of Negosyo Centers to be maintained/sustained 597** 299

Number of Negosyo Centers to be established 150* 150
Number of clients to be 500,00 15,00
assisted 0 0

* Figure includes basic, advanced, and full service Negosyo

Centers
** As of December 31, 2017, there are 789 Negosyo Centers

Pondo sa Pagbabago at Pag-asenso (P3) Program

2018: PhP1.0 billion

For the Small Business Corporation to provide MSMEs with an
alternative
source of financing at a reasonable cost in order to boost the
development of the MSME Sector

26 2018 PEOPLE’S

BUDGET
 MAINTAINING THE FOUNDATIONS
FOR SUSTAINABLE DEVELOPMENT
ACCELERATING THE IMPLEMENTATION
OF STRATEGIC INFRASTRUCTURE

V
ital to a nation’s development is sufficient
and quality infrastructure, since excellent
roads, ports, airports, bridges, and other
infrastructure facilities make the movement of
people
and goods from areas of production to markets
more efficient. Access to lagging regions is also
improved, resulting in lower production and
transport costs.
In line with its anti-poverty agenda, the Duterte Administration
plans to invest more than 5% of GDP on land, sea, and air
transport infrastructure, to bring the target infrastructure spending
to 7.3% of GDP by 2022.

Securing the Golden Age of Infrastructure

Target Infrastructure Expenditure, 2 0 1 7 - 2 0 2 2

7.3%
Infrastructure Spending (in billion
Pesos) 6.9% 6.9%
As a % of GDP 6.8%
6.1%

5.4% 1,840.2

1,456.6 1,584.
1,295. 0
1,068.4 5
858.1

2017 2018 2019 2020 2021 2022

Sustaining the For 2018, PhP1,068.4 billion is earmarked for the Build, Build,
Build, Build, Build Build Program, accounting for 6.1% of GDP. This will be used to
Program improve and construct roads, railways, airports, and seaports across
the nation.

Infrastructure Projects 2017

(in billion Pesos) 2018 Power Supply 4.8 4.2
GAA Systems
Road Networks 327.6 424.9 Seaport Systems 2.6 3.5

School 78. 92. Airport 6. 9.

Buildings 6 7 Systems 8 8
Flood Control Systems 82.0 133.4 Buildings 35.8 35.3

Irrigation 27. 28. Development 97. 104.

7 of
Fund
Systems 5 4 5
Hospitals and LGUs
11. 22. Reforestation Projects 7.
Health 4
Centers 3 3 6.6
10. 6. Railway 22. 227..
Water Supply 0 4 s 1
Systems 43
 Upgrading the Public Transport System

PhP43.6 billion is earmarked for the Department of Transportation (DOTr) to

provide all Filipinos with a safe, affordable, and comfortable public transport
system.

PhP1.1
Air Transport B Rating of Airports
Night
Boost the nighttime landing capacities of airports in Pampanga,
Albay, and Agusan del Norte
PhP9.8 B
Construction/Rehabilitation of
for the
Airports
Aviation PhP425 PhP386
Infrastructure PhP900 M
Kalibo PhP900
Bicol (New M M
Bukidnon M Bohol
New
Program
International Legaspi) Airport (Panglao)
Airport, Aklan International International
Airport Airport

Three foreign-assisted Bus Rapid Transit (BRT) projects aim to ease Road Transport
traffic congestion in Metro Manila and Metro Cebu:

PhP3.1 B PhP300
PhP275
Cebu M Transit
Bus Rapid Metro Manila BRT M Manila BRT Line 2
Metro
Project Line 1 (Epifanio Delos Santos
(Bulacao-Ayala-Talamban) (Quezon City) Avenue)
STOP

PhP22.3 billion is allotted for rail transport programs for 2018 to increase the
Rail Transport target number of weekday passengers by 5% from a baseline of 1.1 million
passengers.

PhP5.8 PhP3.2 PhP2.5 PhP1.3 PhP1.0

B
Mindanao Railway B
North-South B
North-South B Line 1
LRT B Line 3
MRT
Project Phase I Railway Project Commuter Railway South Rehabilitation and
(Tagum-Davao- Phase 2 (NSCR) Project PNR (Cavite) Capacity
Digos) PNR South North Extension Expansion
Project

Sea Transport

PhP5.5 B PhP2.0 PhP71 PhP60 PhP41

For the Maritime B
Maritime M
Continuation of M
Rehabilitation M
Rehabilitation of
Infrastructure Safety the construction and Maribojoc, Baclayon,
Program Capability of Taganak Port improvement and Guindulman
Improvement in Turtle of Catbalogan Ports in Central
Program Island, Tawi- City, Samar Visayas (Region
30 2018 PEOPLE’S
Tawi Wharf Pier I VII)
BUDGET
 MAINTAINING THE FOUNDATIONS
FOR SUSTAINABLE DEVELOPMENT
PURSUING JUST AND LASTING PEACE

E
nduring peace can only be achieved when the fundamental needs of citizens are met. In line with this,
the government vigorously pursues a peace-building agenda, translated into strategic development programs and
projects
that will focus on conflict-affected and vulnerable communities, particularly in
Mindanao.
A Framework for Peace and Development
PhP7.3 billion will fund the PAyapa at MAsaganang
PamayaNAn (PAMANA) Program to help improve governance,
reduce poverty, and empower communities distressed by
conflict through a focused delivery of infrastructure and basic
social services.

Of this total, PhP5.2 billion is allotted for the Department of

Public Works and Highways (DPWH) for the construction of
roads and bridges in conflict-affected areas already identified by
the Office of the Presidential Adviser on the Peace Process
(OPAPP).
Other PAMANA Projects
Roads and Community Support Support to Indigenous
Bridges (Department of Social Peoples (National
(ARMM) Welfare and Commission
2018: PhP560 Development) on Indigenous
M 2018: PhP1.5 B Peoples) 2018:
2017: PhP0 2017: PhP1.0 B PhP8 M
Health Insurance Study Grants 2017: PhP8 M
Premiums (PhilHealth) (Commission on Higher
2018: PhP54 M Education) 2018: PhP19 M
2017: PhP61 M 2017: PhP22 M

Ensuring Security in Mindanao

An increased budget of PhP33.1 B is allotted for the Autonomous Region in Muslim Mindanao (ARMM), which has been declared the
poorest region in the country in 2012 and 20151. The bulk of the budget will be used to improve logistics and literacy in the
region.
Other Programs in the 2 0 1 8 ARMM Budget
ARMM Infrastructure Program = PhP10.2 B

Maintain Construct Maintain 87 Maintain 64 ports Implement 87

992.51
km of and water supply and shore protection water supply
roads rehabilitat
361 km of roads projects structures projects
e
STOP

ARMM-Bangsamoro Regional Inclusive ARMM-Health, Education, Livelihood, Peace,

Development with Growth Equity (ARMM- and Synergy (ARMM-HELPS)
BRIDGE) 2018: PhP2.0 B
2018: PhP3.6 B 2017: PhP1.8 B
2017: PhP2.1 B To service 553 barangays by the end of 2018
To provide 40,000 poor households with water and sanitation
systems, food, shelter, and light in 2018
2012 and 2015 Full Year Poverty Statistics
1 DEPARTMENT OF BUDGET A N D MANAG EM EN T 31
 MAINTAINING THE FOUNDATIONS
FOR SUSTAINABLE DEVELOPMENT
ENSURING SECURITY, PUBLIC ORDER, AND SAFETY

T
o ensure that Filipinos feel safe in their own country, the Duterte
Administration continues to enhance the country’s internal
security
and defense capabilities by investing in the Defense
Sector.
FORTIFYING OUR NATIONAL DEFENSE
PhP150.0 billion is earmarked for the Department of National Defense (DND), 9.3% higher than the 2017
allocation of PhP137.2 billion. A hefty amount of the DND budget, amounting to PhP144.1 billion, goes to the Armed
Forces of the Philippines (AFP).

PhP144.1 B
Total AFP
Budget

PhP64.0 PhP21.3
B B
PHILIPPINE
189
ARMY 19 PHILIPPINE
190 1 NAVY
No. of tactical battalions
maintained 124 179 184

No. of mission-ready
fleet marine units
maintained

PhP19.8 201
B 8
PHILIPPINE AIR 201
140
FORCE 15 7
154 4 201
No. of supportable aircraft
maintained 6
 SAFE AND SECURE COMMUNITIES
With a goal to reduce the national crime rate by 5% in 2018,
the government continues to support its anti-illegal drugs
campaign and other crime prevention strategies.

Reducing
Criminality
Philippine National Police National 911 Program (Department of the
(PNP) Interior and Local Government) = PhP22.4
= PhP132.3 B M
Of which: To hire qualified and competent professionals to
Crime Prevention and improve the hotline’s quick response capability
Suppression Hotline 911 was launched in August 2016 as an effort to
= PhP110.2 B curb criminality and protect the citizens by enabling
5% increase in number of foot and mobile government agencies concerned to respond
patrol operations conducted immediately to emergency situations.

Crime Investigation = PhP667.9

M
522,301 crime investigations undertaken

Towards A Drug-Free
From July 1,2016 - Nation
January 17, 2018
Source: PNP

81,919 anti-drug 119,361 drug PhP19.34 B of illegal

operations
conducte arrested
personalities drugs, CPECs2, and
d laboratory
equipment
seized
STO
P

2
CPECs or Controlled Precursors and Essential Chemicals are ingredients used in the production of illegal drugs.

To pursue its vision of a drug-free Philippines, the government stays committed to its various
anti-drug programs:

Operation of Dangerous Drug Abuse Inmates’ Safekeeping

Treatment and Rehabilitation Centers and Development
(DOH) Program
= PhP818.6 M P = PhP13.4 B
 MAINTAINING THE FOUNDATIONS
FOR SUSTAINABLE DEVELOPMENT
ENSURING ECOLOGICAL INTEGRITY, CLEAN,
AND HEALTHY ENVIRONMENT

T he Duterte Administration is fully aware that environmental

degradation,
climate change, and other environmental risks can erode past
and undermine future development prospects. For this reason,
successes
somebillion is set aside for Natural Resources and Environmental
PhP27.9
Protection and Sustainable Development. Of this amount, PhP25.7 billion,
or 92%, is given to the Department of Environment and Natural
Resources to ensure ecological integrity, clean, and healthy
environment.
PROTECTION
The country faces a serious problem of deforestation, primarily caused by the conversion of forestlands for other
purposes. This has not only severely threatened biodiversity, but has also contributed to increased global warming.
Key programs to address this are:
National Greening Program
Area Planted No. of 2018
Seedlings 124,220 Targets 623,315
201 PhP5.2 ha ha
Number of Number of hectares
8 B 124,220 ha 121 M of planted which are
201 PhP7.1 open
forestlandshectares maintained and
7 200,544 ha 177 M and
rehabilitated protected
B
denudedForest Protection
2018: PhP809 M to patrol 8.2
million km of forest areas, including
166 forest conservation areas, and
deter illegal activities within
forestlands

Solid Waste Clean Water Clean Air

Management Program Program
PhP910 M PhP332 M For PhP272 M
the operation
maintenance of 94
and
To support 50 LGUs in the closure To monitor 456 esteros, 119 more Air Quality Monitoring
and rehabilitation of than the 2017 target of including the calibration of
Stations,
dumpsites and assist 500 337 esteros the air quality equipment
LGUs in the establishment of 48 stations
of materials recovery
facilities
Under the DENR budget is the establishment of an arboretum of native,
endemic and indigenous trees and plant species, including medicinal plants, at
the Ninoy Aquino Parks and Wildlife Center.
FAST FACT
An arboretum is a botanical garden devoted to growing rare, endangered and
symbolic trees for conservation, scientific research, and educational purposes.
 Disaster Mitigation and Preparedness
This covers programs to address the need for environmental
safeguards and focus early attention on environmental standards,
which will help improve the resilience of Filipinos in facing threats from
nature.

Flood Control

Under the DPWH budget, PhP97.0 billion is intended for

the construction and maintenance of flood mitigation
structures and drainage systems.

Regional breakdown for the

construction and National Disaster
Risk Reduction and PhP19.6 B
maintenance of flood
mitigation structures and Management
drainage systems under Program
the DPWH budget (in For reconstruction, rehabilitation, repair,
CAR Pesos)
billion 1.2 aid, relief and other works or services,
NCR 46.7 including pre-disaster activities, such as:
conduct of risk assessment and
Region I 3.9 vulnerability analysis; community-based
Region II 1.2 monitoring systems; capacity-building on
Region III 8.8 mainstreaming Disaster Risk Reduction
and Management/Climate Change
Region IV-A 6.4 Adaptation; construction of dams and
MIMAROPA 2.1 embankments; and development and
Region V 5.8 institutionalization of early warning
systems. RELIEF GOODS

Region VI 1.2 RICE

Region VII 3.8 Quick Response Fund MAMI

Region VIII 3.5 (QRF)
Region IX 1.6 The QRFs are budgetary allocations for pre-
Region X 2.5 disaster and standby funds to enable agencies
to immediately assist the people in areas
Region XI 3.4 stricken by calamities and crises.
Region XII 2.6
In addition to the NDRRM Fund, a total amount
Region XIII 2.1
of PhP7.6 billion is lodged under the budgets of
Note: Figures may not add up due to rounding the following agencies as QRF:
off
DepE PhP2.0
d B
DSW PhP1.2
D B
DPW PhP1.0
H DA B
Office of Civil PhP1.0
Defense NIA B
AFP PhP0.5
B
DO PhP0.5
H B
Nati PhP0.8
onal B
Elec PhP0.5
trifi B
cati PhP0.1
on B
 ENHANCING THE SOCIAL FABRIC
CITIZEN-CENTERED, CLEAN, AND EFFICIENT DELIVERY
OF PUBLIC GOODS AND SERVICES

P eaceful and inclusive societies are founded on the principles of good governance
andlaw.
of theInrule
programs,
pursuit of a people-centered governance, the Administration supports
activities, and projects that curb corruption, improve access to justice, and engage
its citizens.
A LEAN, CLEAN, AND EFFECTIVE GOVERNMENT Currently, there are:
187 government agencies
The National Government Rightsizing Program is a reform 1.7 million government
initiative that aims to address dysfunctions in the positions
government,in response to the increasing public demand for
faster, better, and more efficient services.

Personnel PhP761.7 PhP812.0 PhP990.5

Services B B B

201
2015
7

2016
Refocusing government Simplifying Eliminating duplicating or
efforts and
The Rightsizing resourceswill facilitate a more
Program effective and efficient service
deliveryonby: vital and core
B
government overlapping functions

services A operations,
and processes
systems, within
agencies
and among

Who will be covered? Excluded from the Program: Optional Adoption of the Program:
All departments and Public elementary and secondary The Legislature, The Judiciary,
agencies of the Executive schools, government hospitals, and Constitutional Offices, State Universities
Branch military and Colleges, and Local Government
and uniformed personnel (MUP) Units

The 2018 Budget also supports initiatives to help weed out corruption in the
bureaucracy.

Department of Finance = PhP19.3 B

Revenue Integrity Protection Service (RIPS) Program = PhP25.3 M
Philippine Extractive Industries Transparency Initiative (PH-EITI) Program =
PhP17.8 M Enforcement of Internal Revenue Law, including Run After Tax
Evaders (RATE) and Oplan Kandado Programs = PhP4.9 B
Office of the Ombudsman = PhP2.7 B Civil Service Commission (CSC) =
To act on 77% of grievances and requests, conduct PhP1.5 B To ensure clean and efficient
20% of fact-finding investigations, and prosecute delivery of goods and public services
17.9% of cases
36 2018 PEOPLE’S

BUDGET
 IMPROVING GOVERNMENT SERVICE DELIVERY THROUGH CITIZEN PARTICIPATION
The government promotes citizen engagement and participation aimed at improving the implementation
and monitoring of its programs, activities, and projects.

Public Assistance and Contact Center ng Bayan Implementation of the Anti-

(CCB) Project = PhP26 M Red Tape Act (ARTA) =
To provide a feedback mechanism for citizens to express PhP38 M
their complaints, recommendations, and appreciation on To target 90% of 1,109
the quality of services delivered by the government government frontline service
From August 1, 2016 to November 3, offices with a passing rate in
2017 No. of calls attended to: 213,142 the Report Card Survey1 (RCS)
of the CSC
1
The Report Card Survey is used to obtain client feedback on government service offices’ compliance with the Anti-Red Tape Act of 2007.

FAST, FAIR, AND ACCESSIBLE JUSTICE

Laws and legal aid should be accessible to poor people. The 2018 Budget provides allocations to make
sure that justice reaches and serves the most vulnerable sectors of society.

Department of Justice (DOJ) = The Judiciary =

PhP18.5 B PhP34.3 B

Law Enforcement Services = PhP5.6 B

75% of criminal complaints successfully
investigated and resolved by prosecutors

Legal Services = PhP150.4 M

93% of requests for legal services acted upon
within 15 working days from receipt
Investigation Services (National Bureau Operations of the Supreme Court (SC) and 2,225
of Investigation) = PhP1.3 B Lower Courts = PhP28.8 B
55,500 investigations conducted and acted upon
6,160,000 applications for NBI clearance
Construction of a New SC Complex in Fort
processed Bonifacio, Taguig = PhP1.5 B

Free Legal Services to Indigents and Construction of 23 Halls of Justice

Other Qualified Persons (Public (Justice Infrastructure Program) = PhP0.9 B
Attorney’s Office) = PhP3.0 B
76.24% of cases handled with favorable Hiring of Court Decongestion Officers =
disposition PhP0.2 B

IMPROVED BUSINESS CLIMATE

The government’s efforts to reduce the incidence of corruption and criminality will attract
more foreign investors to do business in the country. Foreign direct investments (FDIs) are
expected to increase by 10% from the 2017 level to a target of PhP680 billion in 2018.

Investment approvals recorded by the Board of

Total Approved Invest ents increased to PhP51.3 billion in January
m mpared PhP8.0 billion registered in the
FDIs 2018 to n the same ous year.

541
co previ
month (January
2016 201 2018(Targ PhP51.3 (January
i 2018)
PhP442
B B
7
PhP617 et)
PhP680
B
PhP8.0
2017) %
B INCREAS
B
E
Source: Board of ts, Invest Philippines DEPARTMENT OF BUDGET A N D MANAG EM ENT 37
Investmen
 INCREASING GROWTH POTENTIAL
VIGOROUSLY ADVANCING SCIENCE, TECHNOLOGY,
AND INNOVATION

T he Philippines aims to reach upper-middle income status by 2040. This will be

possible
by investing in Science, Technology, and Innovation (STI) — the three crucial
drivers
the economic
country.
in development and social progress of a

As the primary agency for research and development (R&D) in the scientific field, the
Department of Science and Technology (DOST) receives a budget of PhP21.2
billion for 2018.

Developing Human Resources Connecting the

in STI
The United Nations Educational, Scientific and Cultural Organization Country
recommends an average of 380 R&D researchers per million
PhP1.7 billion
population. To reach this target, a budget of PhP4.0 billion has For the Free Wi-Fi PhP372
been alloted for current and new science and technology (S&T) Internet Access in million For the
scholarships. public places, including National
in SUCs Government
Portal
PhP2.4 B PhP3.2B PhP4.0B PhP206 million
For the National
PhP51
27,007 30,806 36,997 million For
Scholars Scholars Government Data the National
2016 2017 Scholars Center Broadband Plan
2018
PhP76 million
For the Balik Scientist Program which encourages
Overseas Filipino scientists and experts to return
to the Philippines and share their expertise

Increasing R&D
Innovation in
various sectors Increasing Public
Awareness
PhP2.0 billion
For the development of S&T programs PhP18.9 million
in the
For the DOST’s Filipino Weather Channel, to
PhP1.0
different billion
regions
address information and education gaps in
For rapid and inclusive growth in the agricultural, the STI field
aquatic, and natural resources sectors
PhP9.9 million
PhP848 million For the installation of more Science and
For the Small Enterprise Technology Upgrading Technology Research Based Openly
Program which assists micro, small, and medium Operated Kiosk Stations (STARBOOKS) in
enterprises (MSMEs) remote areas nationwide

38 2018 PEOPLE’S

BUDGET
 THE BUDGET CYCLE
The four phases of the Budget Cycle overlap in continuing cycles. While the Executive Branch
implements the Budget for the current year, it also prepares the Budget for the next fiscal year and
defends it before Congress. The government monitors, evaluates, and reports on actual performance year-
round. P RE PA RA TI O
N
01

1. Issuance of Budget Call

(December of previous
year)
2. Citizen Engagement/ RDC Consultations
(January-February)
3. Conduct of budget hearings and review of
Tier I for Budget Year
(BY) (February)
4. Program convergence (April)
5. Submission of Tier II budget proposals for BY (April-
May)
04 6. Conduct of budget hearings and review of Tier II for BY
(May-June)
7. Consolidation, validation, and confirmation (June) 02

LEGIS LATI O N
8. Approval of the proposed National Budget by
Accountability Reportsthe Cabinet for BY (July) 2.1 Budget deliberations
(Every quarter of the CuY) in the House of
9. Submission of the Proposed National Budget
Representatives and Senate
2.Posting of Disbursement Assessment
to Congress (July) (August-November)
Reports (Every month of the CuY) 2.House and Senate
4.1 Submission of ratification of the General
3.Publication of Mid-Year
quarterly Budget and Report for CuY
ACCO U

Appropriations Bill (August-

and Year-End Report for Prior Year
Financial November)
(August-September)
4.4 Conduct of 3. 3. Enactment of the
audit (Within the (August
1 of previous General
following year) Ea
year) Appropriations Act
3.2 Submission of Monthly Disbursement
N TA

rly (GAA) (December)

Program pr (October of previous year)
oc
3. Submission of Budget Execution Documents (BEDs)
BI L

based on the National

ur Expenditure Program (NEP)
(December of e previous year)
ITY

m (January of CuY)
4. Awarding of contracts
en
5. Submission tof adjusted BEDs based on GAA
(January of ac
CuY)
tiv
iti
6. Release of Notices of Cash Allocation (NCAs)
essemester (January of CuY)
for the 1st
7. Release of NCAs for the
2nd semester (July of
CuY)

P
This schedule is based on Joint Circular 03
No. 2017-1 issued on June 30, 2017 by the EX EC
Department of Budget and Management, UTI O N
Department of Finance, and the National
Economic and Development Authority.

40 2018 PEOPLE’S

BUDGET
 Organizational
Performance Indicator
Framework (OPIF)
 PEM Framework

PEM

MTEF OPIF

PEM – Public Expenditure Management

MTEF – Medium Term Expenditure
Framework
OPIF – Organizational Performance
Indicator Framework
 PEM Expected Results

 Aggregate fiscal discipline -

spending
within
 Allocative efficiency affordable
limits
 Operational efficiency
- spending on
the right
things
- providing
goods and
services at
reasonable
cost

3
5
 OPIF Key Elements*

OPIF

MFO Performance
(Outputs) Indicators
(Output/Outcome
- based)

* Strategic Allocation of Resources per Major Final Outputs

(MFO)
* Performance Measurement System per output-outcome-
based performance indicators
 ANALYTICAL FRAMEWORK

Logical Framework (Logframe) Approach in OPIF

Establishing Linkages between:

SOCIETAL GOALS
(Impact)

SECTOR GOALS

(Outcome ORGANIZATIONAL OUTCOME

)
Performanc
e
MAJOR FINAL OUTPUTS
Indicator/s
(Outputs)

P/A/Ps

(Inputs BUDGE Target

) T s 6
Organizational Outcomes:
Examples
• Department of Public Works and
Highways:
– “Improved national network for access
and mobility of people, goods and
services”

• Department of Labour and

Employment:
“Jobs/ income for assisted individuals”

3
9
 Major Final Outputs
(MFOs)
• Goods and services that a department
or agency is mandated to deliver to
external clients
Directly contributing to organizational
outcomes
Through the implementation of programs,
activities, and projects (PAPs)

• Consumed outside of the organization

• Tangible and more easily quantified

• Within the control of the department/

agency

4
0
 MFOs: Examples
• DSWD MFOs:
 Policies, plans and programs formulated for social welfare
and development concerns
 Licences and accreditation issued to intermediaries;
implemented and enforced
 Training and capability services to intermediaries
 Social welfare services delivered to center-based
clients

• DPWH MFOs
 Properly maintained national roads
 Well-constructed/ improved/ rehabilitated national
roads
 Properly maintained major flood control structures/
facilities
 Well-constructed / improved/ rehabilitated major flood
control structures/ facilities
 Quality engineering and other specialized support
services

41
 PAPs: Examples

• DOH PAPs for Health Regulation

MFO:

Regulation of Food & Drugs

including National
Pharmaceutical Policy, Food
Fortification & Salt Iodization
Regulation of Health Facilities
& Services
Regulation of Health Devices &
Technology
Quarantine Services &
International
Surveillance
43
Implications/Requirements

1. MFO-budget structure alignment

– PAP-MFO linking
– “Serious” agency preparation & DBM
evaluation of MFO Budget Matrices
A&B
– Minor adjustments in BPMS (or
addition of OPIF-based budget
module)
2. Refinements / Enhancements of:
– MFO Performance indicators
– MFO targets & cost requirement
3. MFO-APR alignment
– Designing an OPIF-based APR

45
Implications/Requirements

4. Institutionalization of OPIF
– Mainstreaming OPIF APR in
budget preparation and
execution/review systems
– OPIF-perspective in inspectorate
– Continued and consistent
advocacy to:
• Agencies
• Congress
• Other stakeholders
– Integration in budget processes,
policies & management decisions
– Making other reforms OPIF-based
• Rationalization (EO 366)
• MTEF/FE

46
Ongoing PEM Reforms
• Forward Estimates
 Rolling three-year expenditure
estimates
 Expected financial implications of
the budget-year policy decisions
 Help achieve funding
predictability for output-
based budgeting

• Budget Strategy Paper

 Outlines government’s strategic
directions on fiscal policy,
developmental priorities and
resource allocation

48
OPIF and Ongoing PEM and other
Reforms
• Linking OPIF and the Current
Reforms in the Budget Process:

Integration with FEs and Budget

Strategy Paper to provide greater
funding and policy certainty
 Improve allocative decisions
following costings of MFOs
 Greater transparency-Financial
and Management Information
System capable of processing
performance information
 Greater accountability through
annual performance reporting
 Tighter external audits,
including performance audits

49
Transforming Performance
measurement to Performance
Management
• Process of transformation
 Undertake Department
planning and address
human resource issues
 Develop Business
Group Strategies and
Operational Plans
 Introduce individual performance
agreements and personal
development
 Implement performance reviews
• Capacity building, leadership and
management culture
 Leadership and change
management
 Teamwork
 Delegation, trust and
empowerment
 Learning organization
50
Why OPIF Matters: Departments &
Agencies
• Clarifies roles, functions, and
accountabilities among
agencies
• Predictable funding for core
business
Predicated on a reformed Plan-
Budget process, better cash
management, Contingency
Reserve
Greater control over internal
resource deployment
• Manage performance
expectations
What is achievable and
realistic within funding
constraints
• Communication tool
• Better workforce
Encourage innovation
 More job satisfaction
52
 PROPOSED LOGFRAME FOR OPIF
DEPARTMENT OF BUDGET AND
MANAGEMENT

Societal
Goal Poverty
Alleviation

Sectoral
Goals

Fiscal Anti- Bureaucratic

Strength Corruption Reforms

Organizatio
nal
Outcomes
D.
A. Improved B. Improved C. Enhanced
Operational Allocative Strengthened Accountabili
Efficiency of Fiscal ty and
NGAs Efficiency Responsibility Increased
and Transparency
Discipline in Public
Sector
1, 4, 2,
2, 3, 4,
Major Final
5, 4, 4, 5,
Outcomes

4. Budget
1. Staffing 5. Technical
Compensation 2. 3. Fiscal Authority
Expenditu Budget & Cash Assistanc
&
Organizational re Progra Requirem e
Standards, Policies & ms ents Rendered
Guidelines, Guideline Submitt Released to NGAs,
Procedures, s ed to to GOCCs,
Systems Formulate Preside NGAs, LGUs in
Developed, d, nt/ GOCCs Budget &
Plans & & LGUs Managem
Dissemin Congres
Proposals and ent,
ated & s
Reviewed & Monitor Procurem
Approved and Monitored
ed ent
Compliance (ARP) 2
Reform
Monitored 4