Gov’t shifts to 3--yr rolling budget plan

The government is shifting to a three-year rolling budget program starting this year in an attempt to lock on to budget allocations for long-gestating programs.

Finance officials said the three-year rolling budget program would allow government to commit to longer programming although they admitted it would be harder to get Congress to adhere to the executive program.

According to Finance Secretary Margarito B. Teves, the budget would still be approved by the Congress annually and the General Appropriations Act would still be an annual law, but the over-arching program would stretch over at least three years.

"Our commitment to the budget program will be over a period of three years," Teves said. "It’s hard to think on a year-on-year basis because it lacks continuity. We need to shift to a mindset that will take us beyond the yearly grind."

Teves said the initiative was fully supported by foreign donors who would be willing to defray part of the cost of the policy adjustment. "We need to show commitment to the program."

Teves said the efficient solution is to draw up a three-year budget with enough flexibility that would allow the government to plan over a longer period instead the short-sightedness of annual budget planning.

He said the executive department could draw up a three-year program accompanied by a three-year budget.

The rolling budget approach was first proposed by former Budget Secretary Emilia Boncodin who wanted Congress to approve every three years as well.

But finance officials admitted that Congress is not likely to support three-year programming even if annual budget deliberations normally end up consuming more time, forcing the executive department to use a re-enacted budget for at least the first quarter of every year.

The Department of Finance (DOF) said three-year budgeting would not make much difference in terms of government programming since much of the annual budget are fixed.

Interest payments or debt servicing, for instance, are fixed right from the start and do not allow room for flexibility. The only portion of the budget that could flex are operations-related expenses, including subsidies.

The DOF pointed out that other countries do the same thing instead of engaging in the annual debate over the national budget. Auditing and reporting would be conducted annually as usual but ideally, budget allocations could be done every three years.

Every year, however, government is getting less and less flexibility with its budget as the package is trimmed down to the base essentials of debt servicing and salaries of government employees with very little left over for development projects.