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One of the first things we look at in the national budget are the items under the heading “Automatic Appropriations”. This is where you will find two of the biggest chunks in the budget – debt servicing and internal revenue allocations.

Automatic appropriations are important because they account for almost half of the annual budget. For 2012 it is pegged at P723 billion, or around 40% of the P1.8 trillion total proposed appropriations.

Imagine our surprise, therefore, when we couldn’t find any details for automatic appropriations in the 2012 National Expenditure Program (NEP) submitted to Congress last week by the budget department. The NEP is what eventually gets passed as the General Appropriations Act (GAA).

Whereas previous NEPs provided a breakdown of items and amounts under automatic appropriations, this year’s budget book did not. Instead, we found white spaces, blank entries, under the heading “Automatic Appropriations”.

Even the table summarizing the national government’s appropriations and obligations found in the annex section had blank entries.

We finally found the information, disagregated and spread over several separate tables, in the Budget Expenditure and Sources of Financing (BESF), a separate book used as reference for the budget deliberations.

Apparently, the practice was started in last year’s GAA published in the Official Gazette, the thinking being that since said amounts were appropriated by virtue of other legislation (like the Marcos-era PD 1177 which classifies interest payments as automatically appropriated), then it is not part of the GAA.

This time, the DBM went one step further and erased the entries even in the proposed budget, saying they wanted to suppress the possibility of Congress tinkering debt servicing and other automatically appropriated items. The idea is that automatically appropriated funds are beyond the reach of Congress. This denies Congress any power over approximately half of the national budget.

In the Development Budget Coordinating Council (DBCC) briefing last Monday, congressmen were informed that debt service payments would reach more than P350 billion. Meanwhile, principal amortizations, considered an off-budget item, would reach more than P400B next year. Such figures have been kept out of Congress’ reach as well.

By removing the figures, congressmen are kept in the dark about such appropriations. They are prevented not only from scrutinizing the figures but from introducing amendments to such big items as debt service payments, IRA, Duties and Taxes, and Special Accounts.

I raised this concern during the first budget hearing last Monday and was informed by appropriations committee chairperson Rep. Joseph Abaya that in fact, motions to amend items under automatic appropriations would be prohibited for the 2012 budget. This is the first time that this will be done, as in fact such amendments were proposed, approved and passed in previous Congresses, with Malacañang simply vetoing what Congress had approved.

True, some laws deem certain obligations as automatically appropriated. Still, it is well within the powers of Congress, to scrutinize the budget in full and decide whether or not to actually allocate funds for such purpose. This is the essence of Congress’ “power over the purse.” The Executive has no right to deny Congress its rights and powers.

This practice by the Aquino government is in contrast to what is happening in the United States, where the Obama administration has to negotiate with their House and Senate leaders to be allowed to exceed its debt payment ceiling.

What is truly bothersome is that this brazen sleight of hand is happening under an administration that trumpets transparency and accountability as its hallmarks. It is one thing to insist that Congress not tinker with the automatic appropriations provisions of the national budget and another thing to erase the figures from the book. The former is the Executive’s prerogative, the latter is simply bad faith.

This is just like the Administration saying it is all for transparency and accountability even as it puts roadblocks to the passage of the Freedom of Information Bill. Its classic hypocrisy.#

One thought on “Some budget magic

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