DBM pushes shift to cash budgeting system

After 2025 budget mess

MANILA, Philippines — Following the controversial budget this year, the Department of Budget and Management (DBM) is backing the passage of a measure that will institutionalize the cash-based system to boost transparency.

In an interview, Budget Secretary Amenah Pangandaman welcomed House Speaker Martin Romualdez’s bill that seeks to overhaul the national budgeting system into a cash-based one every year.

Pangandaman said the Budget Modernization Act would strengthen the budgetary process — from crafting to releases to utilization.

“We want to have a manual of operations of sorts. Like a bible of how to go about with our budget,” Pangandaman told The STAR.

The Budget Modernization Bill has been part of the common legislative agenda of the Legislative-Executive Development Advisory Council for the past years.

Pangandaman said there have been previous filings of the same measure but did not actually progress due to other priority agenda of the administration.

“This would significantly help considering that there’s a greater call now on transparency and accountability in the budget process,” she said.

In 2019, former president Rodrigo Duterte mandated the cash budgeting system via an executive order where all contracts of up to 12 months should be delivered by the end of the fiscal year.

Before this, the government was implementing an obligation-based budgeting where contracts awarded can be delivered even after yearend.

Pangandaman maintained that institutionalizing cash budgeting would expedite budget utilization and promote discipline with departments expected to propose projects that are shovel-ready.

She added that it is also a more transparent manner of budgeting as it would show the financial resources that the government is spending.