A pleasant morning to the esteemed members of the 19^th Congress, fellow workers in the government, the media, and every Filipino whom we hope to serve well through this budget. Muli, magandang umaga.

A budget that is responsive to every need of every Filipino—this was our mantra in each analysis and every decision we made in crafting the fiscal year 2023 National Expenditure Program (NEP).

The proposed national budget for 2023 amounts to 5.268 trillion pesos. This is higher than this year’s budget by 4.9 percent and equivalent to 22.2 percent of the gross domestic product or GDP.

Its theme—“Agenda for Prosperity: Economic Transformation Towards Inclusivity and Sustainability.”

As you know, we face a lot of external pressures. Despite these, it’s the government’s responsibility to ensure that none of its citizens is left behind. But the harsh truth is, many Filipinos suffer because of soaring oil and food prices, insufficient health facilities, and expensive commodities. Add to this the effects of the pandemic.

It’s against this backdrop that we created the NEP. At the heart of the proposed national budget is inclusive and sustainable prosperity. It’s encapsulated under our 8-Point Socioeconomic Agenda and anchored on these pillars:

1. Strengthening the purchasing power of Filipinos;

2. Reducing vulnerability and mitigating scarring from the COVID-19 pandemic;

3. Ensuring sound macroeconomic fundamentals; and

4. Supporting local governments.

To strengthen the purchasing power of Filipinos, we will aim for food security, improved transportation, and affordable and clean energy.

The Agriculture sector will receive a substantial increase of 39.2 percent year-on-year, with a total proposed budget of P184.1 billion for the strengthening of its banner food programs and irrigation services to ensure food security and agricultural productivity. To achieve this, higher allocations are proposed for the National Rice Program (Php 30.5 billion) to help maintain the price of rice at affordable levels, and for the production of other vital agricultural commodities. This will be complemented by the construction and rehabilitation of farm-to-market roads (Php 13.1 billion), improvement of irrigation networks (Php 29.5 billion) and the provision of subsidies and credit access to farmers and fisherfolk (Php 2.8 billion).

The Agriculture sector will receive a substantial increase of 39.2 percent year-on-year, with a total proposed budget of Php 184.1 billion for the strengthening of its banner food programs and irrigation services to ensure food security and agricultural productivity.

To achieve this, higher allocations are proposed for the National Rice Program (Php 30.5 billion) to help maintain the price of rice at affordable levels, and for the production of other vital agricultural commodities. This will be complemented by the construction and rehabilitation of farm-to-market roads (Php 13.1 billion), improvement of irrigation networks (Php 29.5 billion) and the provision of subsidies and credit access to farmers and fisherfolk (Php 2.8 billion).

In line with this, the Department of Transportation (DOTr) will receive a budget of Php 167.1 billion, equivalent to 120.4 percent increase over the previous year’s level.

Meanwhile, the Department of Public Works and Highways (DPWH) will receive Php 718.4 billion in 2023 for its banner programs such as the Asset Preservation Program (Php 88.5 billion), Network Development Program (Php 140.4 billion) and Bridge Program (Php 38.0 billion), among others.

Finally, the Department of Energy (DOE) will receive a total of Php 476 million in 2023 for its programs such as the Renewable Energy, Development Program, Energy Efficiency and Conservation Program, and Alternative Fuels and Technologies Program.

To reduce our vulnerability and mitigate scarring from the COVID-19 pandemic, health care, social services, and safe reopening of face-to-face classes are our priorities.

Abiding by the Constitution and reflecting the President’s commitment to invest in human capital development and empower the youth, the Education sector will receive the highest allocation—Php 852.8 billion covering Department of Education (DepEd), State Universities and Colleges (SUCs), Commission on Higher Education (CHED), and Technical Education and Skills Development Authority

(TESDA).

With the Department of Education’s allocation, we hope to finally resume face-to-face classes to ensure holistic learning.

We will achieve this through the construction of new classrooms and education facilities under the Basic

Education Facilities Program (Php 9.8 billion) and the provision of learning materials through the Flexible

Learning Options Program (Php 19.4 billion), among others.

Students will also continue to receive subsidies and education assistance to help them pursue senior high school and technical-vocational courses (Php 54.9 billion).

We will likewise prioritize funding for the Universal Access to Quality Tertiary Education Program (P47.4 billion) which will provide free tuition and other school fees to college students who will eventually constitute the country’s workforce.

But human capital development must be accompanied by a strong healthcare system that can withstand

unprecedented challenges. As such, the Health sector will receive Php 296.3 billion for 2023.

Therefore, the Universal Health Care program will continuously be a budget priority to ensure accessible

healthcare for Filipinos, especially those in the lower stratum of society. This will be accompanied by better health services through the construction and rehabilitation of health facilities and procurement of medicines and vaccines.

Along with human capital development, we must take care of those most vulnerable to global inflation.

As such, the Department of Social Welfare and Development (DSWD) will receive Php 197.0 billion for

2023 to address the needs of the poor and marginalized, among other targeted sectors of the economy.

This includes the proposed increase of the budget allocation for the Pantawid Pamilyang Pilipino Program (Php 115.6 billion).

Now, for the government to better implement these plans, we must make change within the bureaucracy.

Towards this end, we will prioritize digitalization and accelerate digital transformation. Thus, we have allotted some Php 12.1 billion to fund ICT projects throughout the bureaucracy We will also fast track the rollout of the Philippine Identification System (PhilSys) (Php 2.1 billion).

On DBM’s end, we have a budget reform agenda.

Foremost is the digitalization of the economy with the roll-out of the Budget and Treasury Management System or BTMS in all agencies.

We will likewise enhance bureaucratic efficiency through the institutionalization of the Cash Budgeting System.

Our economic transformation agenda also contemplates full devolution of essential services to Local Government units. This allows them to directly implement programs and interventions tailor-fit to the needs of their constituents.

These programs are just a few of the many. More details can be found in the digital and physical 2023 NEP kits we have shared with you. It includes the President’s Budget Message and the 2023 People’s Proposed Budget at-a-Glance.

We believe that the Congress is one with us in our commitment to serve the Filipino people through the just allocation of the national budget.

Again, it is our honor to submit the FY 2023 NEP.

With this budget, we want every Filipino—especially our farmers, fisherfolk, laborers, and those who are

marginalized—to not just survive, but to reap the benefits of economic growth and national progress in their everyday lives.

That is the measure of the Philippines’ genuine prosperity— when every Filipino prospers individually.

Thank you and Mabuhay!

​Speaker Atty. Pangalian M. Balindong and all ​officials of the Bangsamoro Transition Authority;

Newly appointed Bangsamoro Parliament members;

Architect Eduard U. Guerra, and all committee vice chairs, members, and ex-officio members;

MFBM Minister, Atty. Ubaida C. Pacasem;

JICA Senior Representative Mr. Ebisawa Yo and representative Ms. Yukiko Sano;

​Dr. Romulo Emmanuel Miral Jr.;

​​Resource speakers, participants, ladies and gentlemen

Assalamu Alaikum. Warahmatullahi Wabaratu.

Three weeks ago, I was honored to attend the launch of the Public Financial Management Competency Program or PFMCP for BARMM Middle Managers in Davao.

Even in the midst of budget hearings, I made it a point to be present not only out of duty, but also because of my personal conviction to empower the Muslim community.

From Davao, we flew to New York for the Philippine Economic Briefing which resulted in lasting ties with key stakeholders that will propel the inflow of investments in the country. We then braved the back-to-back confirmation and plenary hearings just last week, when both the agency budget of the DBM and the General Appropriations Bill were approved.

And to cap off the hectic week and month, we took part in the culmination of the National Peace Consciousness Month led by the Office of the Presidential Adviser on Peace, Reconciliation, and Unity.

In my keynote message, I cited the establishment of the Bangsamoro Autonomous Region in Muslim Mindanao as a historic win for the whole country. The mission of the Bangsamoro Government to “ensure the necessary conditions for enduring peace and sustained socio-economic development suitable to the systems of life, needs, and aspirations of its people” gives me confidence to say that at this point in our history, we have achieved peace.

I believe that the rest of the Philippines and BARMM can grow together as two governments working in support of each other towards a common goal—to provide better living conditions for every Filipino.

As a daughter of Mindanao, it is my personal dream to see a BARMM that is thriving and a Mindanao that shines as the land of promise. And collaborating with you, together with the JICA, in this PFM journey is our way of helping realize your mission to formulate and implement a dynamic fiscal policy towards the upliftment of the lives of the Bangsamoro.

The PFMCP aims to enhance the technical skills and competencies of our public financial managers on planning, directing, and controlling financial resources towards the effective and efficient delivery of public services.

We have already conducted several activities with BARMM since 2020 including an executive session for the members of the Committee on Finance, Budget, and Management; a session and course for Cabinet members and Executives of Ministries and Offices; an educational tour for the Office of the Chief Minister and the Support to Bangsamoro Transition or SUBATRA; and the recently concluded PFMCP for BARMM Middle Managers.

This time, the goal of our PFMCP is to enhance the current public financial management practices in the region while undergoing the transition.

For this session, we have a set of top-caliber subject matter experts to walk you through the PFM fundamentals relative to local revenue policies and procedures; the principles of local taxation and fiscal sustainability, budget legislation; local government fiscal management; staffing and organization; and the budget process including the Cash Budgeting System or the CBS—one of our budget reforms.

Likewise, the Budget and Treasury Management System or the BTMS, which we will fast-track together with the Department of Finance, the Bureau of the Treasury, and the Commission on Audit, is a crucial digitalization initiative.

As a web-based, fully-automated, and centralized database, the key objective of the BTMS is to achieve the future state of PFM where all spending agencies would capture government transactions at source using the BTMS as the sole accounting fiscal reporting system.

This complements Executive Order 170 (s. 2022)—which I advocated during my time as Assistant Governor of the BSP. EO 170 mandates the adoption of digital payments for government disbursements and collections.

Through all of these, we hope we can equip you, our PFM practitioners from the Parliament, with the knowledge and skills that will enable you to develop and implement effective laws and decisions for the Bangsamoro people.

As we all know, a sound PFM is fundamental to meeting development objectives and reducing poverty, which are the desired outcomes of both the Bangsamoro and the national government.

Speaking of reforms, we will also lead the efforts towards the issuance of an Executive Order to institutionalize the operations of the Open Government Partnership or the OGP in the Philippines.

The OGP is a multilateral organization of reformers from inside and outside the government working towards transforming public service delivery through securing concrete commitments from governments reflective of the values of access to information, public accountability, citizen participation, and leveraging on technology and innovation to strengthen governance—all of which are in line with the PFM core values of accountability, transparency, integrity, and fiscal responsibility, among others.

We hope to arm you with the knowledge and skills you will reap from this undertaking—will join us in implementing all these reforms I am positive that this session will not only equip you with the PFM fundamentals, but will also, and more importantly, strengthen your resolve to be part of a new generation of PFM practitioners:

• who are accountable to the people and each other;
• who embrace innovations through digital transformation;
• who act with integrity at all times; and
• who recognize that governments exist for and because of the people.

We need all of you in order to carry out our agenda for economic prosperity that truly ensures inclusivity—one where no Filipino would be left behind, the Bangsamoro people included.

Maraming salamat po! Inshallah, the Philippines will become a peaceful and more prosperous country for all Filipinos. Salamat po.

Honorable Senator Sonny Angara, Chairperson of the Committee on Finance; Honorable President Pro-Tempore Loren Legarda, Senate Minority Floor Leader Sen. Aquilino “Koko” Pimentel III, Sen. Risa Hontiveros, and honorable members of the Senate, good morning.

On behalf of the Department of Budget and Management (DBM), I thank you for giving us this opportunity to present DBM’s proposed budget for the Fiscal Year 2023.

Mr. Chairperson, before we begin the presentation, allow me to say a few introductory words. In the same way that I am advocating prudent management of fiscal resources in the entire bureaucracy, I will also ensure the efficient and sound utilization of government funds and resources within the DBM.

The DBM and its attached agencies will lead by example and this is reflected in our Php 1,816.87 million budget proposal, which shall cover the operating requirements of the Office of the Secretary (OSEC) and the Government Procurement Policy Board – Technical Support Office (GPPB-TSO).

This proposed budget is underpinned by my priorities as DBM Secretary—bureaucratic efficiency, budget reform and modernization, and green public procurement.

With this budget proposal, the DBM commits to deliver two Organizational Outcomes: First, “Allocative efficiency and operational effectiveness enhanced,” and second, “Budget Improved through sustained fiscal discipline and fiscal openness.”

Organizational Outcome 1 or Allocative efficiency and operational effectiveness enhanced corners the biggest share with P474.14M, equivalent to 87.49% of the proposed budget for OSEC’s Program for Operations. It covers the bulk of the DBM functions–which shall be explained further in the course of our presentation.

While Organizational Outcome 2 or Budget improved through sustained fiscal discipline and fiscal openness will be provided with P28.14M, or 5.19%.

Thank you, Mr. Chairperson and members of this Committee. At this point, I request you to recognize Director Dante B. De Chavez of DBM’s Financial Service.

Department of Finance Secretary Benjamin Diokno, National Economic and Development Authority Secretary Arsenio Balisacan; and Bangko Sentral ng Pilipinas Governor Felipe Medalla;

Our panel discussants, San Miguel Corporation Chief Finance Officer and Treasurer Ferdinand Constantino, BPI lead economist Emilio Neri Jr., and Security Bank Senior Vice President and Treasurer Orencio Andre Ibarra III;

And the organizers and all the viewers of this event, good morning.

To the officers and members of the Economic Journalists Association of the Philippines, congratulations on the success of your 2022 Economic Forum and thank you for this opportunity to share the Department of Budget and Management’s plans and priorities.

Since I took my oath of office as Budget Secretary before President Ferdinand “Bongbong” Marcos Jr., the Department of Budget and Management has been busy crafting a budget that’s not only responsive to the needs of the time, but also the priorities of the Marcos administration.

It has been quite a challenge, as the unprecedented crisis and myriad challenges beyond anyone’s control have pushed our fiscal space to its limits. But we wasted no time, endeavored to make the most out of our limited fiscal space, and have already presented the administration’s first National Expenditure Program or NEP, amounting 5.268 trillion pesos, to President Marcos Jr. on July 28. And we are now gearing up for its submission to the 19th Congress on Monday, August 22.

Indeed, [Preparing the national budget] was not easy as our gains continue to be undermined by various inflationary pressures and external conflicts. But this only strengthens our resolve to ensure that the government’s programs, activities, and projects will reach every Filipino and improve their quality of life—amid the pandemic, through our recovery, and beyond.

This is why the 2023 National Budget is anchored on the theme, “Agenda for Prosperity: Economic Transformation Towards Inclusivity and Sustainability.”

Our agenda for prosperity focuses on food safety and security, and human capital and infrastructure development, among other priority sectors. It is anchored on the Administration’s overarching goals of creating more quality and green jobs, reducing poverty incidence, promoting digitalization, and achieving an inclusive and resilient economy.

As part of the Economic Managers’ Medium-Term Fiscal Framework, government disbursements will remain above 20.0 percent of GDP on average over the entire plan period. With the Build, Better, More program, infrastructure spending is projected to reach between 5.0 percent of GDP to 6.0 percent of GDP over the next six years. We also expect the deficit to return to the pre-pandemic levels of 3.2 percent of GDP beginning 2027, before closing at 3.0 percent of GDP by 2028.

As for us at the DBM, budget reform remains our top priority. This will allow us to effectively and efficiently lead public expenditure management and ensure the equitable, prudent, transparent, and accountable allocation and use of public funds.

[Bureaucratic Efficiency]

In line with our vision of a lean, efficient, and responsive government workforce, the proposed 2023 National Budget will facilitate the transformation and digitalization of government processes, records, and databases through e-governance. Through digital transformation of the bureaucracy, we can improve the ease of doing business, limit human discretion, and enhance transparency in government transactions.

In pursuit of an agile bureaucracy, we will build on past gains such as Executive Order 170, series of 2022, which mandates the adoption of digital payments for government disbursements and collections.

With its effective implementation and through further digitalization, as well as the proposed National Government Rightsizing Program and Cash-Based Budgeting System, we aim to enhance bureaucratic efficiency to ensure quick and responsive public service delivery to the Filipino people.

Towards this end, we will enhance the existing Government Integrated Financial Management Information Systems or GIFMIS which will:

• significantly improve the cash management of our country’s treasury;
• allow greater financial management;
• improve data governance; and
• enhance oversight control.

An integral part of the GIFMIS is the Budget and Treasury Management System or BTMS which we will fast-track together with the Department of Finance, the Bureau of the Treasury, and the Commission on Audit.

As a web-based, fully-automated, and centralized database, the BTMS shall:

• facilitate the generation of vital information on all aspects of government financial transactions;
• serve as an online ledger where transactions are mapped in real-time from purchase to payment; and

The implementation of the BTMS is a crucial digitalization initiative.

It has already been introduced and pilot-tested in different government agencies and is presently being reviewed for improvement and optimization.

[Cash Budgeting System (CBS)]

Another reform we intend to pursue is the institutionalization of the Cash Budgeting System or CBS through the Budget Modernization Bill, which is a priority legislative measure of the Administration that will strengthen fiscal discipline in government.

The DBM will push for the gradual implementation of the CBS under Executive Order No. 91, series of 2019 to ensure timely and efficient implementation of government programs. It is expected that the CBS will be fully implemented for the whole government by 2025.

The CBS aims to achieve the following:

• Address bottlenecks in obligations, which is expected to lead to on-time implementation and disbursement of the government’s programmed projects.
• Better planning of government agencies leading to higher utilization rates and improved public service delivery

As stated by the President, the CBS will help ensure that every peso budgeted by the government would lead to the actual delivery of programs and projects, especially amid the execution of post-pandemic recovery plans, large infrastructure spending, and increased social safety nets.

[Green Public Procurement (GPP) Roadmap]

To support the Marcos Administration’s goal of ensuring sustainable management and use of natural resources by 2030, the DBM, through the Government Procurement Policy Board, will spearhead the implementation of the Green Public Procurement or GPP Roadmap.

The GPP Roadmap aims to integrate green choices in public procurement and put the government closer to its ultimate goal of ensuring sustainable management and use of natural resources by 2030:

• As such, a GPP Manual is currently being crafted to guide procurement practitioners in embedding green specifications.
• To date, the government has seven Common-use Supplies and Equipment or CSE items with green specifications.
• Further, there has also been an increase in government agencies adopting green specifications in non-CSE items, from 26% in 2018 to 58% in 2020.

This aims to radically transform the Philippine market by integrating green choices in public procurement and with the long-term perspective of achieving sustainable public procurement initiative.

[Other reforms: Forward Estimates and 2-Tier Budgeting Approach]

Just as we are introducing new reforms, we shall likewise strengthen existing ones in our pursuit of sound fiscal management.

The two-tier budgeting approach provides separate discussions and deliberations for ongoing or existing programs and projects which fall under Tier 1. Meanwhile, entirely new spending measures or proposals, including the expansion of those that are ongoing or existing which fall under Tier 2.

The two-tier budgeting approach, therefore:

• Streamlines the budget preparation process by providing a clearer framework in determining the budgetary allocations of ongoing or existing policies and shifting focus on the evaluation of new spending proposals in terms of impact and capacity of agencies to execute them;
• Enhances the accountability of departments or agencies for budget programming and execution of their ongoing and existing programs and projects through greater involvement in the Forward Estimates process and through Cabinet-approval of the ceilings; and
• Engages the President and the Cabinet in setting the strategic direction and distribution of the unallocated fiscal space.

In May this year, we urged our government agencies to revisit and reevaluate their Tier 1 budget proposals to provide additional fiscal space for new public programs and projects under Tier 2.

They were directed to ensure that their budget proposals for both tiers are:

• responsive to the expenditure directions and key sector strategies for 2023;
• implementation-ready;
• reflective of the agency’s absorptive capacity; and
• aligned with the plans and priorities of the administration.

This effort intended to create a national budget that’s not only aligned with our recovery but more importantly with our pursuit of economic transformation toward inclusivity and sustainability. It is inclusive because it adapts to the needs of the 110 million Filipinos around the world. It promotes sustainability because it ensures the long-lasting transformation that are brought about by the administration’s priority projects.

Together with the members of the Economic team, the DBM will remain steadfast in its commitment to prudent and judicial allocation of public funds to ensure that no Filipino is left behind.

Maraming salamat po at mabuhay tayong lahat!