The document discusses the Philippine national budget system, which was established by the Americans during their colonial rule and has largely remained unchanged. It provides definitions and explanations of key budgeting concepts and methods used in the Philippines, including the contents and classification of the national budget, objectives of budget preparation, line item budgeting, performance budgeting, planning programming budgeting system (PPBS), and zero-based budgeting. The system aims to prioritize programs based on government policies and allocate resources accordingly through the annual budget cycle of preparation, legislation, execution, and accountability.
UNIT – IV_PCI Complaints: Complaints and evaluation of complaints, Handling o...
Aproaches, techniques, and appropriations in government
1.
2. INTRODUCTION:
• American influence in local fiscal administration is most
apparent in the area of budgeting. Americans set-up the
administrative system in the Philippines when the Philippines
was still a colony of the United States. The system was largely
unchanged even after the granting of the independence and our
transition from the various regimes to the present republic.
American installed, American introduced and American supervised.
By: Johnny A. Gerardo, ii B, MPA
4. GOVERNMENT BUDGET
• Is the financial plan of a government for a given period usually
for a fiscal year, which shows what its resources are, and how
they will be generated and used over the fiscal period.
• For advance countries, the budget has become a tool for
economic growth and instrument with which to attain full
employment and stability
• For less developed countries, it has become a means
development, to bring about an increase in the per capita real
people.
• Refers to the totality of the budgets of various departments of
the National Government including the national government
support to Local Government Units (LGU’s) and Government-
owned and Controlled Corporations (GOCC’s). By: Jai Leonard
I. Carinan
5. CONTENTS OF THE BUDGET
• The national budget is allocated for the implementation of
various government programs and projects, the operation of
government offices, payment of salaries of government
employees and payment of public debts.
6. THESE EXPENDITURES ARE CLASSIFIED BY:
• EXPENSES CLASS - (Major current operating expenditures)
Personal services like salaries and wages, social security
contributions, overtime pay, etc.
Maintenance and other operating expenditures, such as travelling
expenses, supplies and materials, water illumination and power
services rent, etc.
Internet payments
Allotment to Local Government Units
Subsidies to government-owned and controlled corporations
• SECTORAL
Social services – DSWD programs, Solo parent, Magna Carta for PWD’s.
Habitat for Humanity
Economic Services- Unemployment, infrastructure, Agri Bussiness, Phil
Development Plan, Public investment
• IMPLEMENTING UNIT OF GOVERNMENT
Specific department of agencies
7. OBJECTIVE OF BUDGET PREPARATION
• Prioritization of the program must be made to
ensure that the budget fits government
policies and priorities.
• Budget preparation process has 4
dimensions:
-Setting up the fiscal targets and the level of
expenditures
-Formulating expenditure policies
-Allocating resources in conformity with both
policies and fiscal targets. This is the main
objective of the core process of budget
preparation
8. GOVERNMENTS POLICY REGARDING
CURRENT OPERATING EXPENDITURES
• Limit the growth of current operating
expenditures with provisions to inflation
adjustment
• Encourage adequate cost reduction
measures in operation, overhead expenses
items
• Provide adequate maintenance funds for
infrastructure facilities
• Control the growth of spending for personal
services within the level that can be
9. BUDGET PROCESS
• The Budget Cycle- Four places in managing the
National Budget—Budget preparation, Budget
Legislation, Budget Execution, Budget Accountability
10. LINE ITEM BUDGETING
-Emphasizes listing of objects for itemized expenditures such as
salaries and wages, travelling expenses freight, supplies,
materials, equipment without much regard for the purpose of
programs or projects for which such items are proposed.
Advantages:
-Budgeting offers simplicity- you can easily budget for each area
or department of your company based on historical
expenditures
-It can be easy to justify expenditure because proposed
expenditures are based on historical needs.
- It can give a large urbanization flexible use of budgetary
control. Ex.: facility operations wages and benefits
-It is easy to model after past budgets and other historical data.
Disadvantages:
-May result in your department’s unnecessary spending, unused
funds near the end of the fiscal year—employing the concept
of “use it or lose it”
-The lawmakers were able to pinpoint “object of future choice” –
Legislators so much influence on agencies of their choice.
11. PERFORMANCE BUDGETING
-Refers to a budget in terms of functions, programs and
performance units reflecting the revenue and expenditures of
the government.
A) Performance Budgeting provides:
1) Purpose and objectives for which funds are required
2) Cause of programs and related activities proposed to
accomplish those objectives
3) The output that will be produced under each activity
B) Performance Budgeting implies that the budget must clearly
indicate the actual achievement or output.
C) The cost and benefits of its activity are analyzed for making
decisions regarding allocation of funds.
D) It involves use of management tools, such as work
measurement, bench marketing, and unit costing to prepare a
budget.
E) The system has been designed to plan for long-term.
12. PLANNING, PROGRAMMING, BUDGETING SYSTEM
(PPBS)
• Planning – Identification of goals and objectives for each
major area of activity.
• Programming- Analysis of the programs proposed to obtain
organizational objectives.
-Estimation of the total cost for each
project
• Budgeting- Cost benefit analysis is performed for each
program—a portfolio of projects is selected for
funding.
–The system focuses on funding those projects that will
bring the greatest programs toward organizational goals for
the least cost
-Basically a program and planning budgeting system
-It I a link between planning and programming covering it into annual
budget format
13. ZERO BASED BUDGETING
-Preparing the budget from scratch with a zero-base. Re-
evaluating every line item of cash flow statement and
justifying all the expenditure that is to be incurred by
the department.
-Method of budgeting whereby all the expenses for the
new period are calculated on the basis of actual
expenses.