The Development Budget Coordination Committee (DBCC) presented the P3.757 Trillion 2019 National Budget to the House Committee on Appropriations and House Speaker Gloria Macapagal Arroyo on July 31, 2018. The DBCC, comprised by committee chair DBM Sec. Benjamin Diokno, DOF Sec. Carlos Dominguez, NEDA Sec. Ernesto Pernia, and BSP Gov. Nestor Espenilla, discussed the pertinent details of the country's first-ever cash-based budget, with emphasis on the logic behind the shift from an obligation-based to a cash-based budget. 

A cash-based budget instills greater fiscal discipline and prudent use of limited resources. The shift to a cash-based budget will increase the efficiency of government operations, resulting in a faster and improved delivery of public services.

The one-year time horizon of budget execution will push heads of government agencies to plan ahead, conduct early procurement, and regularly monitor implementation.

In fact, through the limiting of the validity of appropriations to one-year, underspending has been sizably cut to P85.2 billion (or just 3%) in 2017.

Further, as of the first half of 2018, the spending program exceeded by P34.4 billion (or 2%) due to the frontloading and fast-tracking of the completion of programs and projects, including those left behind by the previous administration. The Budget Secretary noted that such performance is unprecedented.

 “73% of the countries around the world, as well as the private sector, are implementing a cash-based budget. This is the way to go if you want transparency and efficiency,” Sec. Diokno remarked.

Annual cash-based appropriations will also encourage a more open and accountable government. In this new system, agency performance will be measured not on contracts awarded (or obligated) but on the actual delivery of goods and services that will improve the lives of Filipinos.

Several congressmen raised their concerns with the apparent nominal "decrease" from the 2018 National Budget of P3.767 Trillion to the cash-based 2019 Budget worth P3.757 Trillion. DBM Sec. Diokno reiterated that the 2018 and 2019 National Budgets are not strictly comparable, since the former is obligation-based.

"The 2019 cash-based budget cannot be directly compared to the 2018 Budget, or any previous obligation-based budget for that matter. An appropriate apples-to-apples comparison would be to estimate the cash-based equivalent of the 2018 Budget versus the 2019 appropriations," Sec. Diokno explained.

 
Notably, the cash-based equivalent of the 2018 Budget is P3.324 Trillion. Hence, the 2019 Budget is actually P433 Billion, or 13% higher than the 2018 Budget. 

"The FY 2019 National Expenditure Program was crafted solely with the people's welfare in mind. After all, the budget is born from the money, the taxes of the people. This budget guarantees a better and more disciplined, accountable cash-based budget that will support strong, sustainable, and equitable growth," Diokno concluded.

House deliberations on the 2019 National Budget will continue for the rest of August 2018.

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