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82nd
PHALTRA Annual National Convention
ASEC. MAXINE TANYA HAMADA
Department of Budget and Management
Inclusive Development &
1
Meaningful Local Devolution
A History of State
Capture
2
“…the (Philippine) state apparatus has
repeatedly been choked by an anarchy
of particularistic demands from, and
particularistic actions on behalf of,
those oligarchs and cronies most
favored by its top officials…”
-Paul D. Hutchcroft
Booty Capitalism
Constraints to Philippine Development
Persistent Fiscal Deficits
3
-5
-4
-3
-2
-1
0
1
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Fiscal Balance (% of GDP)
10
12
14
16
18
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Revenue Effort (% of GDP)
4
National Government Underspending
Poor planning
and linkage
with budgeting
Poor capacity
for program &
project design
Long & tedious
procurement
process
Poor delivery,
monitoring &
evaluation
Complicated
budget release
process
FUNDAMENTAL REASONS:
"Ang unang hakbang ay ang
pagkakaroon ng tuwid at tapat
na hanay ng mga pinuno…
Hinding hindi ko sasayangin
ang tiwalang ipinagkaloob
ninyo sa akin…
“Sa mga kapuspalad nating
mga kababayan, ngayon, ang
pamahalaan ang inyong
kampeon."
-President Benigno S. Aquino III
Inaugural Address
5
6
Increasing Revenues & Reducing Debt
7
Greater Spending on
Socio-Econ Development
8
Universal
Healthcare
4.09 million household
beneficiaries covered
as of June 2014
14.7 million poor &
near-poor families
covered by end-2014
Pantawid
Pamilya
Basic
Education
Infrastructure
2010 classroom & teacher
supply closed as of May 2014
to support K-12 roll-out
Spending increased to
4% of GDP in 2015 and
5% of GDP in 2016
8
Spending on the Right Priorities
​
Third Party Report 2010 Latest Change
Transparency International 2013
Corruption Perceptions Index
134 / 178 94 / 177 +40
World Bank 2014
Ease of Doing Business
144 / 183 108 / 189 +36
World Economic Forum Global
Competitiveness Index 2014-2015
Basic Requirements Sub-Index
Pillar 1: Institutions
Pillar 2: Infrastructure
85 / 139
125 / 139
104 / 139
52 / 144
67 / 144
91 / 144
+33
+ 58
+13
IMPROVED STATE OF GOVERNANCE
9
INVESTMENT GRADE CREDIT RATINGS
​
Robust Economic Growth
(GROSS DOMESTIC PRODUCT)
10
Poverty Reduction
(INCIDENCE BY % OF POPULATION, 1st
SEMESTER)
Source: National Statistical Coordination Board (as of 4 July 2014) Note: New methodology for 2013
11
12
“We have only
remained true to what
we promised our
Bosses: no one will be
left behind, as we tread
the straight path to
progress.”
President Aquino's speech on the
signing of the FY 2015 GAA
December 23, 2014
Rizal Hall, Malacañan Palace
13
Huge NG Budget for Social Services
Should this be LGUs’ in the first place?
P953
billion
National Government Budget
for SOCIAL SERVICES, 2015
P390
billion
Internal Revenue
Allotment (IRA), 2015
14
Inclusive Development
and Meaningful Devolution
INCLUSIVE DEVELOPMENT IS HINGED ON:
Ability of LGUs
to implement
programs &
projects
Greater LGU
accountability for
the results of use
of public funds
Increased voice &
vote of grassroots
communities &
local civil society
15
LGUs LGUs LGUs
Philippine
Development
Plan
Revenues lower than target,
Actual spending higher
18
PFMAT findings show budget
accountability should be strengthened
19
62 out of 80 provinces
116 out of 143 cities
NEED TO UPDATE
their basis for collecting real property taxes
20
Dependence on IRA
LGU-Public Financial
Management (PFM)
Bottom-Up Budgeting
(Grassroots Participatory Budgeting)
From Patronage to Empowerment:
• Giving communities a greater “voice and
vote” over the Budget
• Enable CSOs & NGOs to perform
mediating role with LGUs
• Incentivize LGU investment in PFM and
engaging communities and CSOs
• Make NG more responsive by reflecting
people’s needs in the National budget
22
Bottom-Up Budgeting
Empowering Communities through the Budget
Total for 2015:
From 2013: PhP 8.0B
PhP 20.9B
for 595 cities & municipalities
for 1,590 cities & municipalities
23
• Values-Based
•Meaningful
Devolution
• Meritocracy
• Voice & Vote
• Transparency
• Entitlement
• Dependency
• Poverty
•Institutional
Capture
•Opacity
Towards a New Regime
25
Role of Treasurers and Assessors
in PFM Reform
26
2016: Tuloy ang Laban
82nd
PHALTRA Annual National Convention
Inclusive Development
27
and People Empowerment
ASEC. MAXINE TANYA HAMADA
Department of Budget and Management

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DBM Presentation

  • 1. 82nd PHALTRA Annual National Convention ASEC. MAXINE TANYA HAMADA Department of Budget and Management Inclusive Development & 1 Meaningful Local Devolution
  • 2. A History of State Capture 2 “…the (Philippine) state apparatus has repeatedly been choked by an anarchy of particularistic demands from, and particularistic actions on behalf of, those oligarchs and cronies most favored by its top officials…” -Paul D. Hutchcroft Booty Capitalism
  • 3. Constraints to Philippine Development Persistent Fiscal Deficits 3 -5 -4 -3 -2 -1 0 1 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Fiscal Balance (% of GDP) 10 12 14 16 18 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Revenue Effort (% of GDP)
  • 4. 4 National Government Underspending Poor planning and linkage with budgeting Poor capacity for program & project design Long & tedious procurement process Poor delivery, monitoring & evaluation Complicated budget release process FUNDAMENTAL REASONS:
  • 5. "Ang unang hakbang ay ang pagkakaroon ng tuwid at tapat na hanay ng mga pinuno… Hinding hindi ko sasayangin ang tiwalang ipinagkaloob ninyo sa akin… “Sa mga kapuspalad nating mga kababayan, ngayon, ang pamahalaan ang inyong kampeon." -President Benigno S. Aquino III Inaugural Address 5
  • 6. 6 Increasing Revenues & Reducing Debt
  • 8. 8 Universal Healthcare 4.09 million household beneficiaries covered as of June 2014 14.7 million poor & near-poor families covered by end-2014 Pantawid Pamilya Basic Education Infrastructure 2010 classroom & teacher supply closed as of May 2014 to support K-12 roll-out Spending increased to 4% of GDP in 2015 and 5% of GDP in 2016 8 Spending on the Right Priorities
  • 9. ​ Third Party Report 2010 Latest Change Transparency International 2013 Corruption Perceptions Index 134 / 178 94 / 177 +40 World Bank 2014 Ease of Doing Business 144 / 183 108 / 189 +36 World Economic Forum Global Competitiveness Index 2014-2015 Basic Requirements Sub-Index Pillar 1: Institutions Pillar 2: Infrastructure 85 / 139 125 / 139 104 / 139 52 / 144 67 / 144 91 / 144 +33 + 58 +13 IMPROVED STATE OF GOVERNANCE 9 INVESTMENT GRADE CREDIT RATINGS
  • 10. ​ Robust Economic Growth (GROSS DOMESTIC PRODUCT) 10
  • 11. Poverty Reduction (INCIDENCE BY % OF POPULATION, 1st SEMESTER) Source: National Statistical Coordination Board (as of 4 July 2014) Note: New methodology for 2013 11
  • 12. 12 “We have only remained true to what we promised our Bosses: no one will be left behind, as we tread the straight path to progress.” President Aquino's speech on the signing of the FY 2015 GAA December 23, 2014 Rizal Hall, Malacañan Palace
  • 13. 13 Huge NG Budget for Social Services Should this be LGUs’ in the first place? P953 billion National Government Budget for SOCIAL SERVICES, 2015 P390 billion Internal Revenue Allotment (IRA), 2015
  • 14. 14 Inclusive Development and Meaningful Devolution INCLUSIVE DEVELOPMENT IS HINGED ON: Ability of LGUs to implement programs & projects Greater LGU accountability for the results of use of public funds Increased voice & vote of grassroots communities & local civil society
  • 15. 15
  • 17. Revenues lower than target, Actual spending higher
  • 18. 18 PFMAT findings show budget accountability should be strengthened
  • 19. 19 62 out of 80 provinces 116 out of 143 cities NEED TO UPDATE their basis for collecting real property taxes
  • 22. Bottom-Up Budgeting (Grassroots Participatory Budgeting) From Patronage to Empowerment: • Giving communities a greater “voice and vote” over the Budget • Enable CSOs & NGOs to perform mediating role with LGUs • Incentivize LGU investment in PFM and engaging communities and CSOs • Make NG more responsive by reflecting people’s needs in the National budget 22
  • 23. Bottom-Up Budgeting Empowering Communities through the Budget Total for 2015: From 2013: PhP 8.0B PhP 20.9B for 595 cities & municipalities for 1,590 cities & municipalities 23
  • 24. • Values-Based •Meaningful Devolution • Meritocracy • Voice & Vote • Transparency • Entitlement • Dependency • Poverty •Institutional Capture •Opacity Towards a New Regime
  • 25. 25 Role of Treasurers and Assessors in PFM Reform
  • 27. 82nd PHALTRA Annual National Convention Inclusive Development 27 and People Empowerment ASEC. MAXINE TANYA HAMADA Department of Budget and Management