The Department of Budget and Management has asked government agencies to improve their budget use and avoid underspending if they want to get their proposed budgets for next year.听
“If they are not prepared to fully use the funds allotted to them, their budget proposals for next year will be affected,鈥 Budget Secretary Wendel E. Avisado told a virtual news briefing on Friday in mixed English and Filipino. 鈥淲e look at their budget utilization rate and absorptive capacity in evaluating their budget proposals.鈥听
The Budget department is working on the proposed P5.024-trillion budget for 2022, which will be sent to Congress 30 days after President Rodrigo R. Duterte’s final state of the nation address on July 26.听
Mr. Avisado said听agencies听should听use听the funds听allotted听to them within听a听year,听except for infrastructure projects whose funds are valid for two years.听
To encourage agencies to fully听use听their budgets, the government is adopting a cash-based budgeting system where it only releases the funds that will be used for the year. Unspent funds will automatically听go back to the Treasury bureau.听
The Budget department听released P3.833 trillion to state agencies in the first half,听or听85% of the P4.5-trillion spending program for the entire year.听
State offices听have听reported听a听97% budget听use听rate as of June after using P1.871 trillion of the P1.936-trillion notices of cash allocations issued to them,听according to data from the agency.听This was听better than the听93%听use听rate a year听earlier.听
For the second quarter, their cash use听rate went up to听96% from 90%听a year earlier.听
鈥淲e have the funds and we have released them,鈥 Mr. Avisado said. 鈥淚t’s just a matter of improving the system.鈥听
Underspending by state agencies delay projects aimed at spurring economic growth.听Agencies spent only 69% or 141.45 billion of the P205-billion fund from a second stimulus law five days before it expired on June 30.听鈥 Beatrice M. Laforga听
