Budgeting Process

BUDGETING PROCESS
Government budgeting is the allocation of public funds to attain the economic and social goals
of the country. It also entails the management of government expenditures to create the most
impact from the production and delivery of goods and services
Government budgeting is important because it enables the government to plan and manage its
financial resources to support the implementation of various programs and projects that best
promote the development of the country. Through the budget, the government can prioritize and
put into action its plans, programs and policies within the constraints of its financial capability. 3.
What are the major processes involved in national government budgeting? budget cycle
Budgeting for the national government involves four (4) distinct phases: budget preparation,
budget legislation or authorization, budget execution or implementation and budget
accountability.
First is, the Budget Preparation, this phase involves the formulation of estimates of revenues
and expenditures by the Executive Departments and Agencies. In preparing the annual budget
proposal; the said department makes an estimation of government revenues. It then determines
the budget priorities within available revenues and borrowing limits. Finally, it translates these
approved priorities into expenditures.
The main agency involved is the Development Budget Coordination Committee (DBCC)
composed of the following agencies is as follows:
1. The Department of Budget and Management, the agency responsible for resource
allocation and management;
2. The Department of Finance, the agency responsible for resource generation and debt
management;
3. The National Economic and Development Authority (NEDA), the agency responsible for
overall economic activity;
4. The Bangko Sentral ng Pilipinas (Central Bank of the Philippines), the agency
responsible for monetary measures and policies;
5. The Office of the President of the Philippines, the agency responsible for the approval
and oversight of the budget
In the preparation of the budget, the DBCC approves the parameters, makes a budget call,
conducts budget hearings, makes a budget review then consolidates the budget. It then validates
and confirms the budget, which is finally approved by the President of the Philippines and his
Cabinet members. The President thereby submits the budget to Congress for approval.
The second phase is the Budget Legislation/Authorization; this pertains to the whole range of
legislative action on the budget, leading to the enactment of a General Appropriations Law for
the year. The Philippine House of Representatives first conducts hearings/debates on the budget.
The House then approves the budget, for submission to the Senate. Senate hearings and debates
are conducted on the budget, which is finally approved. A Bicameral Conference Committee
composed of representatives of the Philippine House of Representatives and the Senate is
convened. After approval by the Bicameral Conference Committee, the President enacts the
budget which is known as the General Appropriations Act.
The third phase shall be the Budget Execution/Implementation: Budget execution covers the
allotment of appropriations by the central budget authority to and the incurrence of obligations
by, the spending departments and agencies of government. The steps in the execution of the
budget are:
1. Release of the funds by the Department of Budget and Management (DBM), once the
GAA is signed therefore we are already authorized to get the budget from the National
Treasury, we formulate the GAA for the transparency since it was scrutinized by the
executive officer down the line so if any malpractice of certain group of people is intended,
the session and plenary activities are the boundaries and will see to it that all the budget to
be acted shall be appropriated properly.
2. Implementation of the various programs and activities by the different government
agencies involves the formulation of allotment and cash programs and Government
Programs/Projects/Activities can now be implemented due to funding release
Fourth and final phase is the Budget Accountability & Review, this involved the reporting of
actual performance against plans or targets, and it involves the Monitoring of agency budgetary
performance, Comparison and evaluation of actual performance with the initially-approved work
targets, A summary list of checks issued is submitted on a monthly basis and the Physical &
Financial Report of operations is submitted on a quarterly basis in the form of a trial balance.
In addition, the Commission on Audit (COA) figures prominently in the assessment of agency
performance. The COA is the government body tasked with looking at the legality, propriety,
and accuracy of government financial transactions.
The COA has auditors assigned to each government agency and it has regional offices to review
these transactions. Those that are considered excessive, inappropriate or illegal are not passed in
audit. COA can recommend means for setting them right, if such is still possible. Trial balances
of agencies, which are submitted to DBM and COA on a quarterly and annual basis, report how
agencies use up their allotments and cash allocations.
There is no such thing as perfect planning or budgeting regardless of in-depth analysis
and rigorous scrutiny. There are still problems encountered during each phase of the budget
cycle.

Budgeting Process

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BUDGETING PROCESS

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