[In This Economy] Homicide on the Price range Categorical

So many flood management investigations are occurring, and I admit it’s getting more durable to maintain monitor of present occasions (even for a information junkie like me).

However over lunch the opposite day, whereas catching up on the information, I had a eureka second: an important revelation made all the things click on in my head, and the puzzle of the Marcos administration’s finances anomalies made a lot extra sense.

The flood management fiasco resembles a homicide thriller, a whodunit. The sufferer right here is the federal government’s finances, and identical to in Agatha Christie’s Homicide on the Orient Categorical, the assassin seems to be, nicely, everybody: from lawmakers, DPWH officers, non-public contractors — and even finances officers and President Ferdinand Marcos Jr. himself (the one who opened Pandora’s Field to start with).

Let me share with you what clicked in my head.

It begins with the proposed finances, ready by Secretary Amenah Pangandaman of the Division of Price range and Administration.

You see, a giant a part of Pangandaman’s duty yearly is to arrange the proposed finances of the manager department, additionally referred to as the Nationwide Expenditure Program or NEP. It prescribes a most finances yearly, which Congress can’t exceed. The Structure says, “The Congress might not improve the appropriations advisable by the President for the operation of the Authorities as specified within the finances.”

In different phrases, Congress can solely reallocate objects within the proposed finances. No matter finances they find yourself approving wants to remain inside the most set by the NEP.

Nonetheless, it seems that Congress discovered a strategy to bypass this limitation. Since 2023, this got here within the type of titanic jumps in so-called “unprogrammed appropriations” (see graph under).

Unprogrammed appropriations or funds are objects within the nationwide finances which are on stand-by mode, and might’t be spent on until the federal government finds extra or new revenues, or new loans for foreign-assisted initiatives.

The graph under reveals the composition of unprogrammed funds over time. In 2023, the largest chunks had been “Help to foreign-assisted initiatives” (P344.14 billion) and “Precedence infrastructure program for roads, bridges, multi-purpose buildings/services, flood management, and water programs” (P145.47 billion). Observe that these weren’t discovered within the NEP, so we all know they had been inserted by Congress.

This implies two issues.

First, many initiatives had been faraway from the programmed funds and put in unprogrammed funds. These embrace many foreign-assisted initiatives, precedence social packages, ICT modernization in state universities and schools, cost for right-of-way, and social pension for indigent senior residents.

Second, there have been large insertions for exhausting infrastructure initiatives like flood management initiatives. Certainly, we obtained affirmation from the current occasions that these funds had been approved from the bloated unprogrammed funds.

Consultant Mikaela Suansing, chair of the Home of Representatives appropriations committee, made this illuminating revelation on September 23 in a plenary session: “The [Unprogrammed Appropriations] releases for flood management initiatives for 2023 is P34 billion, and for 2024, it’s P107 billion. So throughout 2023 and 2024, the UA releases for the flood management mission is P141 billion. And our distinguished colleague [ACT Representative Antonio Tinio] is correct, these initiatives are usually not said as a line merchandise.”

Since no particular initiatives are recognized within the unprogrammed funds, it’s just about a revival of the previous system of discretionary pork that was supposedly banned by the Supreme Court docket in late 2013. Intelligent, eh?

However the subsequent query is, what approved the discharge of funds for flood management beneath the 2023 unprogrammed funds? Congress and the Division of Price range and Administration should come clear and reveal what particular excuse was used to set off the discharge of funds. (Once more, beneath the 2023 finances regulation, it might solely be extra income collections, new income sources, or loans for foreign-assisted initiatives.) They need to additionally make clear if the unprogrammed fund objects within the 2023 finances might nonetheless be spent on in later years.

Shifting on to the 2024 finances, the largest bounce in unprogrammed funds was “Strengthening help for presidency infrastructure and social packages” (P225.38 billion). In comparison with the earlier 12 months, it doesn’t even say it’s for roads, bridges, multi-purpose buildings/services, flood management, or water programs. However once more, that is undoubtedly pork funds. Tellingly, that is additionally not discovered within the NEP, so Congress made this insertion as soon as extra.

As well as, nevertheless, Congress added a new provision on how cash might be launched for the initiatives listed beneath unprogrammed funds. Aside from extra and new revenues, and loans for foreign-assisted initiatives, they added this: “Fund stability of the government-owned or -controlled firms (GOCCs) from any the rest ensuing from the overview and discount of their reserve funds to affordable ranges considering the disbursements from prior years.”

By no means earlier than has this provision entered any finances in historical past, and solely the 2024 finances comprises this line. But it surely’s essential as a result of it’s the availability that allowed the Division of Finance, led by Secretary Ralph Recto, to compel PhilHealth to give up P90 billion of its funds again to the Treasury. The Philippine Deposit Insurance coverage Company additionally surrendered greater than P107 billion of its “reserve funds” on the premise of this provision within the GAA.

Suansing lately confirmed that P107 billion was used to finance flood management initiatives for 2024. This was corroborated by Price range Undersecretary Rolando Toledo in one of many Senate hearings. Is that this the exact same P107 billion that was obtained from PDIC? I wouldn’t be shocked if this had been the case.

Recall that PhilHealth surrendered P60 billion to the Treasury, on the behest of Recto, earlier than the Supreme Court docket issued a short-term restraining order. What initiatives listed beneath unprogrammed funds had been financed utilizing the P60 billion from PhilHealth, if not flood management? Possibly street networks? Multi-purpose buildings? Once more, Congress and Price range Secretary Pangandaman should come clear and clarify.

When the PhilHealth money sweep was flagged in 2024, Congress took a touch and eliminated the availability within the unprogrammed funds permitting for comparable money sweeps. That’s nowhere to be discovered within the 2025 finances.

However Congress found out that other than persevering with to place large pork initiatives within the unprogrammed funds, they’d additionally put different pork funds within the programmed portion of the finances as an alternative. That approach, funding from the treasury is safe, and so they don’t have to rely an excessive amount of on one other money sweep of GOCCs simply to realize entry to pork.

This explains the mammoth modifications carried out by the bicameral convention committee (or bicam for brief) in late 2024, as they had been finalizing the 2025 finances. (Members embrace the previous chair of the home appropriations committee, Zaldy Co, who’s now on the run, and Stella Quimbo, the previous vice chair.) The modifications made by the bicam from the Normal Appropriations Invoice are visualized under. Observe the P288.65 billion last-minute insertion for the DPWH’s finances, which comprises politicians’ pork.

However do not forget that by the Structure, Congress can’t exceed the utmost finances set within the NEP. So to make room for the bloated DPWH finances (which ended up exceeding P1 trillion), they needed to put many objects within the unprogrammed funds as an alternative. That is the explanation for the P373-billion bounce in funds for unprogrammed appropriations in 2025.

These 2025 unprogrammed funds nonetheless included P160 billion for “Strengthening help for presidency infrastructure and social packages.” However on the identical time we noticed a bounce in “Help to foreign-assisted initiatives” (primarily Division of Transportation initiatives), a bounce within the AFP Modernization Program, Precedence Social Applications (P77 billion), Pantawid Pamilyang Pilipino Program (P50 billion), Authorities Counterpart of Overseas-Assisted Tasks (P26.3 billion), and lots of extra.

In whole, the 2025 unprogrammed funds reached P531.66 billion. That’s triple what was within the NEP.

All in all, the items of the puzzle are falling into place. The present flood management investigations are shedding increasingly gentle on the finances anomalies which have cropped up in recent times and exploded right into a full-blown scandal beneath President Marcos’ watch.

At any price, the investigations should proceed in order that we are able to determine all of the culprits on this finances homicide thriller. Observe that Marcos himself, and his finances secretary, Pangandaman, are usually not off the hook. In reality, they need to be liable as nicely for permitting this technique of insertions to thrive, and for signing off on the anomalous budgets for the previous three fiscal years.

The larger process forward of us is twofold: to make the corrupt and the negligent pay for his or her sins, and ensure the nationwide finances isn’t bastardized and corrupted ever once more.

That’s a really tall order. However what selection do now we have? – Rappler.com

JC Punongbayan, PhD is an assistant professor on the UP College of Economics and the writer of False Nostalgia: The Marcos “Golden Age” Myths and How you can Debunk Them. In 2024, he obtained The Excellent Younger Males (TOYM) Award for economics. Observe him on Instagram (@jcpunongbayan).