Crooks incorporated: Distortions flood the budget cycle

YELLOW PAD NEPOMUCENO MALALUAN MALOU MANGAHAS and JENINA JOY CHAVEZ

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(GAA) was historically largely unchanged, there has been a spike in Unprogrammed Appropriations over NEP levels beginning 2022. In 2024, from a proposed level of P282 billion, the GAA level reached P732 billion, or an increase of P450 billion over proposed.

Even as the defunded proposed programs were transferred to Unprogrammed Appropriations and the resulting fiscal space in Programmed Appropriations were replaced by Congressional insertions, the 2024 GAA also introduced a Special Provision authorizing the fund balance of GOCCs as a source of financing for the bloated Unprogrammed Appropriations. The Philippine Health Insurance Corp. (PhilHealth) was among the GOCCs from which fund balances were swept for this purpose.

“Insertions” have become an apt term for this apparent robbery-in-band of the national budget. Which insertions were introduced by which members of the House of Representatives and the Senate is the question in everybody's mind.

At the Blue Ribbon Committee hearings, contractors and district engineers have said that the insertions become “sponsored” projects by legislators, earning for them “commitment” fees or kickbacks as high as 30% of the allotment — monies advanced by contractors even before formal procurement commences. In the vernacular, nagbababa ng pondo.

These changes to the appropriations bill did not happen transparently during the open budget deliberations as envisioned by House and Senate rules. Under the chambers’ rules, amendments should take place during the period of amendments in plenary. In practice, however, it appears that only committee amendments are openly introduced in plenary. Individual amendments have been introduced after the voting on second reading.