To ensure that the government won’t run short of funds to fight COVID-19, the Department of Budget and Management (DBM) has ordered agencies to tighten their belts and defer non-essential spending.
Budget Secretary Wendel E. Avisado issued National Budget Circular (NBC) No. 580 on April 22, calling for “economy measures” in the public sector as the coronavirus menace continued to loom over the country.
Avisado said while President Rodrigo Duterte is now allowed to realign funds, the “duration and scale” of the pandemic are making it necessary to have enough funds “in a sustainable and responsible manner.”
Fiscal prudence, he said, is of primary concern.
Avisado ordered all departments, agencies, GOCCs, state universities and colleges to free up funds that are not earmarked for COVID-19 response.
Avisado’s circular said starting last April 1, 35 percent of programmed funding would not be released.
The circular also said at least 10 percent of funds released for maintenance and other operating expenses and capital outlays would no longer be available for release.
It also barred the release of funds for “new programs, activities, including Congress-introduced increases which are not likely to be implemented” within the year.
The circular bars vehicle purchases, except ambulances for military and uniformed personnel.
The list of projects that would be denied funding included construction or repair of buildings, foreign travels with exceptions, local travels with exceptions, celebrations, cultural and sports events and hiring of new contractual workers except those needed for COVID-19 response.
All government offices, the circular said, should also reduce by at least 10 percent their electric, fuel, water and utility use. The same amount of savings should also be generated from seminars, training programs, workshops and fees for consultants and technical assistants.
Funds should be saved for COVID-19 response.
Despite these, Finance Secretary Carlos G. Dominguez III on Thursday (April 23) said funding for big-ticket infrastructure projects will remain untouched.
Dominguez had said resumption of massive infrastructure construction after the pandemic would help the economy quickly recover.
The DBM required all offices under the Executive to assess which projects could be discontinued to preserve funding.
Covered by the DBM circular are some P80 billion in funding realigned by legislators in the 2020 national budget for their pet projects. These have now been classified as “for release later.”
The for release later items would go through the wringer before release and needed Duterte approval.
The DBM would submit to Duterte a report on which projects or programs could be discontinued.
While the DBM circular covered only the Executive, it asked other branches of government to save as well.
“The collective action of the whole of government will ensure the efficient and effective promotion and protection of the interests of the Filipino people for their common good,” the DBM said.
Avisado told the Inquirer that the DBM would determine how much more money can be squeezed out of the belt-tightening measures after receiving the agencies’ reports by end of the month.