‘Unused’ funds from government agencies went to Abad’s program

How did the Department of Budget and Management (DBM) cook up the controversial Disbursement Acceleration Program (DAP) and how much of it is exactly at the agency’s disposal?

In 2011, the DBM announced that the Aquino administration would “implement P72.11 billion in additional projects in order to fast-track disbursements and push economic growth in light of the global slowdown and the onslaught of recent calamities.”

The projects, Budget Secretary Florencio Abad said then, would be funded from “unused” appropriations in 2010 and 2011.

But a little-known circular released by Abad on July 18, 2012, has since allowed the administration to tap more of such amounts.

National Budget Circular No. 541, a copy of which was obtained by the Inquirer, allows the DBM to withdraw “unobligated allotments of agencies with low levels of obligations as of June 20, 2012, both for continuing and current allotments.”

The circular also allows “withdrawn allotments” to be used to “augment existing programs and projects of any agency [emphasis by DBM] and to fund priority programs and projects not considered in the 2012 budget but expected to be started or implemented during the current year,” Abad wrote department heads, including budget and accounting officers.

Maximum use of funds

“This measure will allow the maximum utilization of available allotments to fund and undertake other priority expenditures of the national government.”

Unobligated releases refer to funds transferred from the DBM, but remain unused by a particular government agency.

In the budget year immediately preceding the Abad circular, unused appropriations amounted to P238.85 billion. The amount could be broken down into “unobligated allotments,” which were P159.23 billion, and “unreleased appropriations” (meaning those that remained with the DBM) which were P79.62 billion.

In 2012, unused appropriations were slightly down to P216.18 billion, but unobligated allotments were up at P178.06 billion. Appropriations still parked at the DBM were also down to P38.12 billion.

Sought for comment, Abad said the “numbers are too large.”

“They’re not the value of projects covered by DAP in those years,” he said in a text message from Burma (Myanmar). “The basis of DAP is in the revised Administrative Code which in turn is based in the Constitution under executive powers.”

Unconstitutional

Bayan Muna Rep. Neri Colmenares maintained that “it is unconstitutional for the President to term as savings unobligated allotments before the end of the year because only savings can be realigned.”

“All public funds spent on items not considered in the budget violate the Constitution,” he told the Inquirer.

Based on the national budget, the amount of unused appropriations did not include “budgetary adjustments” moved from one agency or department to another, to the tune of P288.11 billion in 2011. Such adjustments ballooned to P358.41 billion in 2012, the year Abad came out with the circular.

“Exempted” from the circular were “special purpose funds” (SPF)—dubbed by critics as President Aquino’s own pork barrel—such as “budgetary support to GOCCs (government-owned and -controlled corporations), which amounted to P10.69 billion in 2011. The entire SPF item that year was P232.49 billion.

The Abad circular also did not touch the congressional pork barrel, the Priority Development Assistance Fund, which was P24.62 billion in 2011.

Since 2011, the SPF has increased to P376.27 billion the following year and P385.47 billion this year. The amount is almost P450 billion in next year’s proposed budget.