Public Financial Management

DILG Napolcom Center, Quezon City

June 19, 2019
1:00 PM to 5PM
Order of presentation
• About Public Financial
Management
• PFM Reforms
Initiatives/projects
• Budget Process (FY 2020)
https://youtu.be/sB01am-ADds?t=30
The Budget and Treasury Management System (BTMS) is a common, modern,
integrated, accurate, reliable and secure information system for the public financial
management (PFM) operations of the Government of the Philippines (GOP). It provides
a sustainable government resource planning solution that is extensible, flexible thereby
supporting a range of public financial requirements, and adaptable to reform and
modernization.

The system will be used to collect and organize government financial information
through a central database that supports the following crucial PFM functions:
1.Budget Management
2.Commitments Management
3.Payments Management
4.Receipts Management
5.Cash Management
6.Property, Plant and Equipment
7.Accounting and Fiscal Reporting
 The BTMS Project aims to achieve
the following objectives:
• Adoption of PFM best practices;
• Integration of appropriations, allotments, cash allocations, commitments,
obligations, disbursements, and reporting functions;
• Elimination of multiple standalone systems;
• Real time on-line monitoring of appropriations versus allotments versus
obligations versus disbursements;
• Government-wide consolidation of reports;
• Systematic real time recording and reporting of all revenues, expenditures,
assets and liabilities;
• Standardization of processes, formats, and reporting across GOP; and,
• Automation of manual processes.
Cash-Based Budgeting
Limits incurring obligations, and disbursing payments to goods
delivered and services rendered and inspected, within the
fiscal year.

Payments of these obligations should be settled within the

fiscal year of the budget.
 Obligation Budgeting vs. Cash Budgeting
When can goods and services be delivered and rendered?

Obligation Budgeting – 24 months & beyond

FY FY + 1
Jan 1 Dec 31 / Jan 1 Dec 31
 Contracts awarded before the end of the FY can be delivered
even after the FY; government has a running balance of not-yet-
due-and-demandable obligations (NYDDO)

Cash Budgeting – 12 months

FY
Jan 1 Dec 31

 12-month contracts should be fully delivered by the end of the FY.

Republic of the Philippines

Department of Budget and Management
 Obligation Budgeting vs. Cash Budgeting
When can obligations be paid?

Obligation Budgeting – 24 months & beyond

FY FY + 1
Jan 1 Dec 31 / Jan 1 Dec 31
 Inspection, verification, and payment can be done even after the
FY; government has a running balance of due-and-demandable
accounts payables (DDAP)

Cash Budgeting – 15 months

Extended Payment
Period (EPP)
FY
Jan 1 Dec 31 Mar 31

 Payment can only be done within a 15-month period; contracts

delivered at the end of the FY can be paid during the 3-month
EPP
Republic of the Philippines
Department of Budget and Management
Budget Preparation (FY 2020)
 Tier 1 Tier 2
(New Spending
and Expansion of Total
P/A/Ps) Proposed
(Ongoing Budget
Spending)
For charging
against the
Forward available Fiscal
Estimates Space
Budget requirements for the following:
• Ongoing activities, programs and projects
• Operation of newly completed facilities as of Dec. 31, 2018
but not provided in the 2019 budget
– Example: furniture, fittings and operating costs (electricity, fuel,
rent) – taking into account of any reductions in existing costs
(e.g. rent)
• Office accommodation and equipment costs for newly-
approved filled positions
Budget requirements for the following:
• Regular periodic activities and programs
• Ongoing ICT P/A/Ps as endorsed by the MITHI
• ISO 9001:2015 Quality Management System certification
efforts;
• Infrastructure subsidy support to GOCCs
Budget requirements for the following:
• Ongoing capital projects that have been approved in previous
years

• Approved projects covered by MYOA

Budget requirements for the following:
• Vehicle replacements for the same purpose and/or intended
user that will reach their end-of-productive/useful/economic life by
FY 2020 per DBM-established guidelines;
• Maintenance cost and spare parts of existing critical assets to
ensure their continued operation
• ICT P/A/Ps previously covered by existing ISSP as endorsed or
approved by the MITHI
Funding requirements for:

• New P/A/Ps or Expansion of existing P/A/Ps

• MOOE costs to implement approved major changes in the

organization or structure of an agency, including downsizing or
mergers
Funding requirements for:

• ISO 9001:2015 QMS certification efforts for an agency which is yet

to start/pursue the same
• Expanded/new ICT P/A/Ps supported with BP Form 202, covered
by the current ISSP, as endorsed by the MITHI;
Funding requirements for:
• Realignment of MOOE funds between P/A/Ps to improve
outcomes including abolition of P/A/Ps;
• New/expansion of infrastructure subsidy support to GOCCs and
LGUs
• Maintenance costs and spare parts for projects to be completed
by 2019
Funding requirements for:
• Proposed new infrastructure projects included in the approved
FYs 2020-2022 TRIP.
• Proposed adjustments in the total cost of an already
approved project by the NEDA Board or ICC as of March 31,
2019 which are implementation-ready
• Purchase of motor vehicles for additional/newly-entitled
officials and/or functions of a newly created agency
Funding requirements for:
• Expanded/new ICT P/A/Ps as approved by MITHI

• Other proposed new and expanded COs that are non-

infrastructure in nature which are implementation ready
 • DepEd • DILG - PPSC
• SUCs • DOST - PSHS
• DND – PMA, NDCP • OEO – TESDA & CHED

– Budget Proposal submissions should cover only those activities

to be implemented within the CALENDAR YEAR 2020, not the
requirements for the whole Academic Year

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 Budget Proposals involving Specific
Concerns
“ All endorsed projects shall still be subject to DBM evaluation”
Endorsing Entity Subject of Endorsement
CHED State Universities and Colleges (SUCs) Budgets
DA Research and Development (R&D) in Agriculture and Fisheries
PSA Systems of Designated Statistics pursuant to EO 352
MITHI Steering Committee ISSP in support of ICT-related proposals
DOST R&D in natural resources, environment, technological and engineering
sciences
DENR-NAMRIA Procurement of Data from Airborne and Space borne platforms and other
related products and services for mapping purposes
ICF Review Panel Funding proposals pertaining to the Hosting of International Conferences
DOH Early Childhood Care and Development Program
DA Agricultural Development Program
DTI Export Development Program
DOT Tourism Development Program
DBM Pasig River Convergence Program
DENR Risk Resiliency Program
HUDCC Marawi Rehabilitation and Reconstruction Program
NEDA Three-Year Rolling Project (TRIP), Public Investment Program (PIP)
Budget Preparation
Calendar

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 Important Timelines to Remember
(NGAs)
ACTIVITY Timelines
RDC Consultation/Dialogue with Selected Agency Central Offices (CO) /ROs
Consultations with RDCs, CSOs, Student/Faculty Assoc. and PASUC, & Other Stakeholders under the February 2019
Assistance to Municipalities
Submission (thru OSBP) of B.P. Form Nos. 201 A, B, C, D –Past Year’s Actual Obligation & FY 2018-2022 Revenue January 28 -
Program February
15, 2019
Submission of the Computation of Tier 1 Proposals by P/A/P and by Allotment Class & FY 2020-2022 Tier 1 February 1-28, 2019
Outyear Requirements
Consultation with Agencies on the Formulated FY 2020 Tier 1 Level, including Program Convergence Budgeting February 1-28, 2019
(PCB)
Deadline of Submission, thru OSBPS: CY 2020 Budget Proposals Tiers 1 (FEs) and 2 as well as Summary of April 26, 2019
Outyear Requirements
Conduct of Technical Budget Hearings for Tier 2 (New Spending) Proposals, including PCB April 22-May 20, 2019
Sending of Confirmation Letters to Agencies of the Total Budget Levels (Tiers 1 and 2) June 13-14, 2019
Printing of CY 2020 Budget Documents June 25-July6, 2019

Submission of the CY 2020 Budget Documents to the July 8,

President 2019
 Deadlines and Submission Requirements
PARTICULARS SUBMISSION REQUIREMENT FORMAT
February 15, 2019
1. FY 2018
Actual BP Form 201 (Schedules A, B, C, & D) OSBPS-
Obligations generated
2. FY 2018 –2022 hard copies
Revenue BP Forms 100 and 100-A, B and C (in triplicate)
Program
February 1 –28, 2019
Computation of Tier 1 Proposals by
1. FY 2020 Tier 1 Programs/ Activities/ Projects (P/A/P) Manually-
Proposals and by Allotment Class prepared hard
2. FY 2020-2022 Tier 1 copies (MS
Out- BP Form 201-E (Tier 1 column only) Excel format)
year Requirements
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 Deadlines and Submission Requirements
PARTICULARS SUBMISSION REQUIREMENT FORMAT
April 26, 2019
1. Details of approved 1. All BP Forms OSBPS-
FY 2020 Tier 1 generated
Ceilings and Tier hard copies
2 Proposals (in triplicate)
2. Supporting 2. Tier 2 justification letter for each submitted BP Manually-
Documents 202; prepared
hard
3. BP Form 202-A (Convergence Programs and
copies
Projects)
(in triplicate)
4. Summary and List of BP 202/203 Proposals;
5. Thrust/Priorities for the Budget Year;
6. Program/Project Implementation Strategies for FY
2020; 20
Link address: http://osbp.dbm.gov.ph/
 Deadlines and Submission Requirements
PARTICULARS SUBMISSION REQUIREMENT FORMAT
April 26, 2019
2. Supporting 7. FY 2018 Actual Physical Accomplishment
Documents under BAR Manually-
(continuation) No. 1 and status of program/project prepared hard
implementation copies
8. Inventory of Equipment as Required under (in triplicate)
NBC Nos. 438, 446 and 446-A including
refleeting/ replacement program.
9. Indicative Annual Procurement Plan approved Manually-
by Head prepared
of Procuring Entity (HOPE) (soft copy in PDF
and MS Excel)
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Submission Venue
Administrative Service – Central
Records Division (AS-CRD),
Ground Floor, DBM Building III,
General Solano Street, San Miguel,
Manila

DBM Regional Office

concerned

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 Budget Legislation
• Budget Hearing conducted by DBM, Congress and Senate
• Approval by the President
 Budget Execution
• Operationalization of the Budget
• Implementation of the Physical Targets (PAPs)
• Preparation of Accomplishment Reports
• Performance Review Assessment conducted by DBM
 Budget Reporting
• Financial Accountability Reports (FARs) and Budget Accountability
Reports (BARs)
(Quarterly/Annual Physical/Financial Report of Operations)
-end of presentation-
 QUESTIONS/
CLARIFICATIONS?