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SEVENTEENTH CONGRESS OF THE )
REPUBLIC OF THE PHILIPPINES )
F ir s t R e g u la r S e s s io n )
*17 MAY 11 P3-45

SENA TE p >
RECEIVED BY;

S e n a te Bill No. 1450 y

I n tr o d u c e d b y S e n a to r LOREN LEGARDA

AN ACT TO REFORM THE BUDGET PRO CESS BY ENFORCING

GREATER ACCOUNTABILITY IN PUBLIC FINANCIAL MANAGEMENT
(PFM), PROMOTING FISCAL SUSTAINABILITY, INSTITUTING AN
INTEGRATED PFM SYSTEM, INCREASING BUDGET TRANSPARENCY
AND PARTICIPATION, AND FO R OTHER PU RPO SES

E xplanatory Note

A 2015 p a p e r p u b lish ed by the In tern a tio n al M onetary F u n d show s th a t

the c o u n try ’s public financial m an a g em en t (PFM) fram ew ork is
fragm ented a n d no t readily accessible to th e public. A 2 0 1 6 rep o rt from
the World B ank reco m m en d s the revision of th e PFM legal fram ew ork to
a d d re ss w e ak n e sse s in b u d g et credibility a n d legislative oversight, am ong
others. The W orld B an k rep o rt fu rth e r observes th a t th e la st
com prehensive PFM law w as e n acted in 1987, th u s th e necessity of
u p d a tin g it to conform to in te rn a tio n a l b e st p ractices.

The proposed m e a su re aim s to m odernize th e c o u n try ’s legal fram ew ork

for PFM by in stitu tio n a liz in g reform s in b udgeting a n d stre n g th e n in g the
oversight fu n ctio n s of C ongress over th e budg etin g p ro cess. A part from
clarifying th e definition of savings, a u g m e n ta tio n , a n d realig n m en t in line
with ju d ic ial p ro n o u n c e m e n ts, it also provides p a ra m e te rs on the
im p lem entation of a re-en acted n a tio n al budget.

Moreover, th e bill c re a te s th e Office of the C om ptroller G eneral to a s s is t

the C om m ission on A udit in enforcing a cc o u n tin g a n d a u d itin g ru les an d
in m onitoring th e com pliance of agencies to a u d it findings.

In o rd er to e n su re a n efficient PFM system th a t is tra n s p a re n t a n d fully

acco u n tab le to the public, im m ediate p assag e of th e bill is so u g h t.
 tlf

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SEVENTEENTH CONGRESS OF THE )

REPUBLIC OF THE PH ILIPPINES )
'17 HAY 11 ? 3 '4 5
F ir s t R e g u la r S e s s io n )

R E C tiV tO BV:
-sV
SENA TE

S e n a te Bill No.4A5 0

I n tr o d u c e d by S e n a to r LOREN LEGARDA

AN ACT TO REFORM THE BUDGET PROCESS BY ENFORCING GREATER

ACCOUNTABILITY IN PUBLIC FINANCIAL MANAGEMENT (PFM),
PROMOTING FISCAL SUSTAINABILITY, INSTITUTING AN INTEGRATED
PFM SYSTEM, INCREASING BUDGET TRANSPARENCY AND
PARTICIPATION, AND FO R OTHER PURPOSES

PART 1
PRELIMINARY PROVISIONS

1 S e c tio n 1. S h o r t T itle. - T his Act shall be know n a s th e “B udget Reform

2 Act.”
3
4 S e c tio n 2. D e c la ra tio n o f P o lic y a n d O bjectives. - It is hereb y declared
5 the policy of the S tate to e n su re a cco u n tab ility a n d integrity in the u se of
6 public reso u rce s by e n su rin g tra n sp a re n c y , fiscal responsibility, resu lts-
7 o rien tation, efficiency, a n d effectiveness. T his shall be u p h e ld th ro u g h the
8 e sta b lish m e n t of a n in te g rate d system of p lan n in g , budgeting, m an ag em en t,
9 in tern al control, acco u n tin g , rep o rtin g a n d review of p ublic finances. In light
10 of these req u ire m e n ts, th e S tate sh all p u rs u e th e following specific
11 objectives:
12
13 (a) To enforce th e pow er of C ongress to a u th o rize all a p p ro p ria tio n s a n d
14 hold g o vernm ent acc o u n ta b le in the u se of public re so u rce s, a s well
15 a s th e resp o n sib ility of all governm ent agencies to propose, execute
16 a n d deliver com m itted re s u lts in th e a p p ro p ria tio n s a c ts in a tim ely,
17 predictable, a n d econom ic m an n er;
18
19 (b) To prom ote people’s em pow erm ent in th e m an a g e m e n t of public
20 reso u rce s by enforcing th e ir right to a cc ess inform ation on, a n d to
21 c o n trib u te in th e form ulation a n d im p lem en tatio n of, th e financial
22 affairs of th e governm ent; an d
23
1 (c) To stre n g th e n th e in teg ratio n of plan n in g , b udgeting, a n d perform ance
2 m an a g em en t a n d e n su re am ple sa feg u a rd s in m an ag in g public
3 finances, inclu d in g th ro u g h in te rn a l controls, acco u n tin g , reporting,
4 a n d risk m an ag em en t.
5
6 S e c tio n 3. S c o p e a n d C o v erag e. - The provisions of th is Act shall apply to
7 the m an a g em en t of rev en u es, ex p en d itu re s, financing a rra n g e m e n ts, a n d
8 a sse ts a n d liabilities of n a tio n al governm ent agencies (NGAs), governm ent-
9 owned or -controlled c o rp o ratio n s (GOCCs), a n d local governm ent u n its
10 (LGUs) to th e e x te n t provided herein.
11
12 S e c tio n 4. D e fin itio n o f T erm s. - The following te rm s w hen u se d in th is
13 Act a n d th e im plem enting ru le s a n d reg u latio n s (IRR) sh all be u n d e rsto o d ,
14 a s follows:
15
16 (a) A llo tm e n t refers to th e au th o riza tio n issu e d by th e D e p artm en t of
17 B udget a n d M anagem ent (DBM) for rele ases n eeding clearan ce in
18 o rd er for NGAs, GOCCs, or LGUs to in c u r c o n tra c tu a l co m m itm en ts
19 a n d d isb u rse fu n d s u p to a c ertain a m o u n t, for a specified public
20 p u rp o se, a n d w ithin a specified period of tim e, in acco rd an ce w ith the
21 A ppropriations Law;
22
23 (b) A p p r o p r ia tio n s L aw refers to th e legislative a u th o riz a tio n for the
24 c o n tra c tu a l c o m m itm en ts in cu rre d by NGAs, GOCCs, or LGUs a n d
25 a c tu a l d isb u rse m e n t of Public F u n d s for specific public p u rp o se s
26 covering a specified period of tim e. T his m ay refer to e ith er a general
27 or special a p p ro p ria tio n s law;
28
29 (c) C a b in e t refers to th e Executive S ecretary a n d th e S e cretaries of the
30 D e p artm en ts u n d e r th e Executive B ranch;
31
32 (d) E x te n d e d P a y m e n t P e rio d refers to the th ree m o n th period in the
33 following fiscal y e ar w hen p a y m e n ts c an be p ro cessed a n d d isb u rse d
34 for goods a n d services received by the end of th e previous y e ar a n d
35 su c h p ay m en t sh all be chargeable a g a in st th e A ppropriations Law of
36 the previous fiscal year;
37
38 (e) F is c a l Y ear refers to a period of twelve m o n th s com m encing on
39 J a n u a r y 1 u n til D ecem ber 31;
40
41 (f) G o v e rn m e n t A g e n c ie s collectively refer to NGAs, GOCCs a n d LGUs;
42
 1 (g) G o v e rn m e n t-O w n e d o r -C o n tro lle d C o r p o r a tio n s refer to agencies
2 w ith co rp o rate pow ers, w h e th er or n o t organized a s a stock or n o n ­
3 stock co rp o ratio n , vested w ith fu n ctio n s relatin g to public need s
4 w h e th er g o vernm ental or p ro p rietary in n a tu re , a n d ow ned by the
5 G overnm ent of th e R epublic of th e Philippines e ith e r wholly or, w here
6 applicable a s in th e case of stock co rp o ratio n s, to th e e x te n t of a t lea st
7 a m ajority of its o u tsta n d in g cap ital stock. T his in clu d es G overnm ent
8 F inancial In stitu tio n s, governm ent co rp o rate in stru m e n ta litie s an d
9 related corp o ratio n s;
10
11 (h) G o v e rn m e n t F i n a n c i a l I n s t i tu t i o n s refer to financial in stitu tio n s in
12 w hich the governm ent directly or indirectly ow ns th e m ajority of the
13 capital sto ck a n d w hich are either: (i) registered w ith, or directly
14 su pervised by, th e B angko Sentral ng Pilipinas (BSP)', or (ii)authorized
15 to collect or tra n s a c t fu n d s or c o n trib u tio n s from th e public a n d place
16 them in financial in s tru m e n ts or a s s e ts su c h a s d ep o sits, loans,
17 b o n d s a n d equity;
18
19 (i) H e a d o f A g e n cy refers to the h ead of th e d e p a rtm e n t or agency in the
20 case of NGAs, th e B oard of D irectors or T ru ste e s in th e c ase of GOCCs
21 a s well a s c e rta in agencies w hich are s tru c tu re d a s su c h , a n d the
22 local chief executive in the case of LGUs;
23
24 (j) I n t e r n a l A u d it is a n in d e p e n d e n t a n d objective a s s u ra n c e in NGAs,
25 GOCCs a n d LGUs w hich is designed to ad d value, im prove o p eratio n s
26 a n d accom plish objectives by bringing in a sy stem atic a n d disciplined
27 ap p ro a ch to ev alu ate the effectiveness of risk m an a g em en t, control
28 an d governance processes;
29
30 (k) L o c a l G o v e rn m e n t U n its refer to provinces, cities, m u n icipalities,
31 an d b ara n g ay s, a s well a s a u to n o m o u s regions a u th o rized to be
32 created in th e C o n stitu tio n ;
33
34 (l) N a tio n a l G o v e rn m e n t A g e n c ie s refer to u n its of th e n a tio n al
35 governm ent, a s d istin g u ish ed from GOCCs a n d LGUs, w hich include
36 any of th e d e p a rtm e n ts, b u re a u s, offices or in stru m e n ta litie s of the
37 Executive, Ju d ic ia l a n d Legislative b ra n c h e s of governm ent, a s well
38 a s th e C o n stitu tio n al C om m issions, a n d th e Office of the
39 O m b u d sm an ;
40
41 (m) P ro g ra m /A c tiv ity /P ro je c t refers to a n item of a p p ro p ria tio n in
42 the GAA w hich refer to an y of the following:
43
 Program - a n in te g rate d group of activities th a t c o n trib u te s to an
ag ency’s c o n tin u in g objective. T hese are grouped u n d e r 3 m ain cost
3 stru c tu re s: G eneral A d m inistration a n d
4 S u p p o rt, S u p p o rt to O perations, a n d O perations.
5
6 Activity - is a w ork p ro cess th a t c o n trib u te s to th e fulfillm ent of a
7 program , su b -p ro g ra m or project.
8
9 Project - is a special agency u n d e rta k in g w ithin a definite tim efram e
10 a n d w hich is designed to produce p re-d eterm in ed goods or services;
11
12 (n) P r o p o s e d N a tio n a l B u d g e t refers to a financial p lan of a n n u a l
13 revenue a n d e x p e n d itu re s to be su b m itte d by th e P resid en t to
14 C ongress th a t reflect n a tio n al policies;
15
16 (o) P u b lic O ffic ia ls refer to elective a n d appointive officials a n d
17 em ployees, in a p e rm a n e n t or tem porary capacity, w h e th er in the
18 caree r or n o n -c a re e r service, in cluding m ilitary a n d uniform ed
19 p erso n n el, reg ard less of th e ra n k , form or a m o u n t of com pensation;
20
21 (p) P u b lic F u n d s refer to th e m onies of all G overnm ent Agencies received,
22 collected, receivable from taxes, fees, c h arg es, p en alties, incom e,
23 dividends, in te re s t earn in g s, dom estic loan proceeds, ex tern al loan s
24 a n d g ra n ts, pro ceed s from th e sale of a sse ts, th a t th e G overnm ent h a s
25 a legal rig h t to re ta in a n d u se a n d sh all n o t in clu d e any m oney
26 received in error;
27
28 (q) S u b s id ia r y refers to a corporation w here a t lea st a m ajority of the
29 o u tsta n d in g cap ital stock is ow ned or controlled, directly or indirectly
30 a n d th ro u g h one or m ore in term ed iaries, by a GOCC; a n d
31
32 (r) T r e a s u r y S in g le A c c o u n t (TSA) refers to th e a c c o u n t m ain tain ed by
33 the B u re a u of th e T rea su ry w ith th e BSP or a g e n t b a n k for a unified
34 stru c tu re of governm en t b a n k a c c o u n ts to enable consolidation an d
35 o ptim um u tilization of governm ent c a sh reso u rces.
36
37 In th is Act, th e sin g u la r m ay be read a s th e p lu ral a n d th e p lu ral m ay be
38 read a s th e sin g u lar, a s th e co ntext requires.
39
 1
2
3 PART II
4 ADDITIONAL ROLES AND RESPONSIBILITIES
5
6 S e c tio n 5. C o n g re ss, - The C ongress shall, in ad d itio n to its pow ers u n d e r
7 the C o n stitu tio n a n d existing law s, perform th e following:
8
9 (a) M onitor a n d review governm ent perform ance a g a in st th e re q u ire m e n ts
10 of a p p ro p ria tio n s a n d related laws, a n d hold G overnm ent Agencies
11 acc o u n ta b le for th e ir financial a n d n o n-financial perform ance;
12
13 (b) Review re p o rts on p lan n e d a n d a c tu a l perform ance, inclu d in g the
14 S ta te m e n t of Fiscal Policy, th e M edium Term Fiscal Strategy, fiscal
15 rep o rts, a n n u a l p la n s of governm ent agencies, periodic a n d a n n u a l
16 rep o rts on g o vernm ent perform ance a n d p erform ance of governm ent
17 agencies; a n d
18
19 (c) C onsider th e co n so lid ated a n n u a l financial s ta te m e n ts of governm ent
20 p rep ared by th e Office of th e C om ptroller G eneral (OCG) a n d the
21 a u d ited governm ent agency rep o rts by th e COA.
22
23 C ongress sh all u n d e rta k e th e foregoing th ro u g h an y of its existing
24 com m ittees, s u p p o rt offices or one created for th e p u rp o se to stre n g th e n the
25 oversight role of C ongress.
26
27 S e c tio n 6. P r e s id e n t. - The P resid en t shall, in ad d itio n to h i s / h e r pow ers
28 u n d e r the C o n stitu tio n a n d existing law s, perform th e following:
29
30 (a) Approve th e S ta te m e n t of Fiscal Policy, a n d th e M edium -term Fiscal
31 S trategy for su b m issio n to C ongress;
32
33 (b) Approve th e B udget Priorities Fram ew ork to identify th e priority
34 a re a s for governm ent sp en d in g a n d guide th e b u d g e t p rep a ratio n
35 exercise; a n d
36
37 (c) A uthorize c h an g e s in th e functional, o p eratio n al a n d organization al
38 s tru c tu re w ithin a n d am ong th e DBM, D e p artm en t of F inance (DOF),
39 an d N ational Econom ic a n d D evelopm ent A uthority (NEDA), a s m ay be
40 n ecessary, to e n su re the effective im p lem en tatio n of th is Act.
41
42 S e c tio n 7, O ffice o f t h e C o m p tro lle r G e n e r a l - To e n h a n c e the
43 m an ag em en t of public finances, th ere is hereby c re ate d a n OCG u n d e r the
44 supervision a n d control of th e Office of th e P resid en t (OP) w hich shall
45 perform the following functions:
46
47 (a) M onitor th e perform ance of th e a n n u a l c a sh a p p ro p ria tio n s of NGAs
48 in te rm s of in -y ear a n d end-of-year a p p ro p ria tio n rep o rts th a t
49 com pare d isb u rse m e n ts to a p p ro p riatio n s;
1
2 (b) F o rm ulate m e a su re s on effective in te rn a l c o n tro ls in clu d in g in tern al
3 a u d it, for th e im p lem en tatio n by H eads of G overnm ent Agencies, to
4 e n su re th e integrity, accu racy , co m p leten ess, a n d reliability of
5 governm ent financial a n d m an a g em en t system s;
6
7 (c) Oversee th e o p eratio n of a n in teg rated in te rn a l control fram ew ork
8 a cro ss G overnm ent Agencies;
9
10 (d) O versee th e im p lem en tatio n of, a n d G overnm ent A gencies’ com pliance
11 w ith, a cc o u n tin g a n d a u d itin g ru les a n d reg u la tio n s pro m u lg ated by
12 the GOA;
13
14 (e) Oversee a n d m an ag e th e financial rep o rtin g of G overnm ent Agencies,
15 including (1) to m onitor th e periodic a n d a n n u a l m an a g em en t an d
16 financial a c c o u n ts w ith regard to accu racy , tim elin ess, com pleteness,
17 a n d com pliance w ith th is Act, s ta n d a rd s , ru le s a n d reg u latio n s; an d
18 (2) to consolidate th e financial rep o rts for su b m issio n to th e P resident,
19 C ongress, a n d GOA;
20
21 (f) Oversee th e operatio n alizatio n of a n in teg rated financial m an a g em en t
22 inform ation system ;
23
24 (g) F orm ulate co m p eten cy -b ased h u m a n reso u rce policies for positions in
25 PFM a n d oversee th e capacity developm ent re q u ire m e n ts on PFM
26 form ulated by th e OCG a n d o th e r agencies;
27
28 (h) C oordinate w ith c o u n te rp a rt agency officials to e n su re com pliance
29 with the foregoing functions; an d
30
31 (i) Perform s u c h o th e r fu n ctio n s a s m ay be n e c e ssa ry to properly
32 im plem ent th e provisions u n d e r th is Section.
33
34 The OCG sh all be h ead e d by th e C om ptroller G eneral w ho sh all be of th e
35 sam e ra n k a s a S ecretary, a n d w ith th e stru c tu re a n d staff co m plem ent a s
36 m ay be approved by th e DBM. The H eads of G overnm ent Agencies sh all
37 desig n ate a C om ptroller in th eir respective offices to oversee the
38 im plem entation of th e above-m entioned fu n ctio n s a t th e agency level in
39 coordination w ith the C om ptroller G eneral.
40
41 S e c tio n 8. C o m m issio n o n A u d it. - The COA sh all, in ad d itio n to its
42 pow ers u n d e r th e C o n stitu tio n a n d existing law s, co o rd in ate w ith th e OCG
43 for the p ro p er en fo rcem en t of tim ely a c c o u n tin g a n d rep o rtin g of public
44 finances.
45
46 S e c tio n 9. D e p a r tm e n t o f B u d g e t a n d M a n a g e m e n t. - The DBM shall, in
47 addition to its m a n d a te s a n d fu n ctio n s u n d e r existing law s, perform the
48 following:
49
1 (a) P repare, in co o rd in atio n w ith th e agencies co n cern ed , DOF, NEDA a n d
2 OP in th e D evelopm ent B udget C oordination C om m ittee (DBCC), the
3 S ta te m e n t of Fiscal Policy, th e M edium -term Fiscal Strategy, the
4 B udget Priorities Fram ew ork, a n d th e M id-year a n d A nnual Fiscal
5 R eports a s req u ired in th is Act;
6
7 (b) M onitor a n d e v alu ate th e financial a n d n o n -fin an cial perform ance of
8 NGAs;
9
10 (c) E valuate a n d review the financial a n d n o n -fin an cial perform ance of
11 GOCCs w ith special law s a n d c h a rte rs, in co o rd in atio n w ith th e DOF
12 an d th e G overnance C om m ission for GOCCs (GCG), a n d approve the
13 a n n u a l co rp o rate o p eratin g b u d g e ts (COBs) of th e GOCCs;
14
15 (d) M onitor a n d review, together w ith th e B u re a u of Local G overnm ent
16 Finance (BLGF) u n d e r th e DOF a n d D e p artm en t of th e Interior an d
17 Local G overnm ent (DILG), the financial a n d non -fin an cial perform ance
18 of LGUs; an d
19
20 (e) A ssess, to g eth er w ith th e BLGF u n d e r the DOF a n d DILG, th e PFM
21 sy stem s of LGUs a n d a s s is t th em in designing a n d im plem enting PFM
22 im provem ent m e a su re s.
23
24 To e n su re th e effective form ulation a n d execution of fiscal policies, the
25 S ecretary of B udget a n d M anagem ent sh all lead th e DBCC, w ith the
26 S ecretary of F inance, th e D irector G eneral of th e NEDA S e c re ta ria t a n d a
27 rep resen tativ e from th e OP a s m em bers, a n d th e G overnor of th e BSP a s
28 reso u rce person.
29
30 S e c tio n 10. D e p a r tm e n t o f F in a n c e . - The DOF sh all, in ad d itio n to its
31 m a n d a te s a n d fu n ctio n s u n d e r existing law s, perform th e following:
32
33 (a) M onitor a n d m an ag e fiscal risk s to th e governm ent, in clu d in g tho se
34 from p u b lic-private p a rtn e rsh ip s;
35
36 (b) Com pile a n d p u b lish governm ent fiscal sta tistic s in acco rd an ce w ith
37 in te rn a tio n a l s ta n d a rd s ; a n d
38
39 (c) F orm ulate policies a n d s ta n d a rd s for th e acq u isitio n a n d m an a g em en t
40 of fixed a s s e ts by NGAs.
41
42 The B u re a u of th e T rea su ry (BTr) shall, in ad d itio n to its m a n d a te s a n d
43 fu n ctio ns u n d e r existing law s, perform th e following:
44
1 (a) M anage th e TSA m ain tain ed a t th e BSP or a n a g e n t b a n k , w ith the
2 prior approval of th e S ecretary of Finance;
3
4 (b) P u t in place a rra n g e m e n ts for th e execution of duly au th o rized
5 p ay m e n ts from th e TSA, w hich m ay include th e a p p o in tm e n t of b a n k s
6 to o p erate a s a g e n ts of the N ational G overnm ent w ith th e prior
7 approval of th e S ecretary of Finance;
8
9 (c) M anage th e financial a s s e ts a n d liabilities of th e governm ent,
10 including: (i) b a n k in g a rra n g e m e n ts for, a n d b a n k a c c o u n ts of, the
11 governm ent; (ii) hedging a n d o th er risk m an a g e m e n t activities
12 asso ciated w ith d e b t m an ag em en t, c a sh m a n a g e m e n t a n d financial
13 in vestm ent; (iii) a p p o in tm e n t of d ealers, a s s e ts m a n a g e rs a n d o th er
14 a g en ts to s u p p o rt debt, c a sh a n d in v estm en t m a n a g e m e n t activities;
15 (iv) m a in te n a n c e of a n a c c u ra te record of th e sto ck a n d flow of
16 financial a s s e ts a n d liabilities; (v) trac k in g a n d rep o rtin g on fiscal
17 risk s related to the m an a g em en t of financial a s s e ts a n d liabilities; and
18 (vi) p re p a ra tio n of in-year d isb u rse m e n t rep o rts b a sed on th e TSA for
19 su b m issio n to th e OCG.
20
21 (d) Issue in s tru c tio n s on the m an a g em en t a n d recording of financial
22 a s s e ts a n d liabilities of th e governm ent;
23
24 (e) A uthorize the opening a n d closing of b a n k a c c o u n ts of NGAs;
25
26 (f) A ssist th e NGAs in providing credible c a sh fo recast for tim ely an d
27 a c c u ra te c a sh program m ing;
28
29 (g) A dm inister th e release of c a sh re q u ire m e n ts covering all types of
30 tra n sfe rs to LGUs; a n d
31
32 (h) E stab lish a n d m ain ta in a consolidated registry of fixed a s s e ts of the
33 N ational G overnm ent.
34
35 S e c tio n 11. N a tio n a l E c o n o m ic a n d D e v e lo p m e n t A u th o rity . - The
36 NEDA shall, in ad d itio n to its m a n d a te s a n d fu n ctio n s u n d e r existing law s,
37 perform the following:
38
39 (a) C oordinate w ith the Regional D evelopm ent C ouncils (RDCs), on the
40 form ulation of regional developm ent p la n s a n d policies th a t are
41 c o n siste n t w ith th e e stab lish ed n a tio n al priorities;
42
43 (b) C oordinate th e form ulation a n d im p lem en tatio n of a n a n n u a l an d
44 m ed iu m -term public in v estm en t program c o n siste n t w ith the
45 approved M edium -term Fiscal S trategy a n d in th e co n tex t of the
46 p rep a ratio n of th e N ational Budget;
47
 1 (c) S et s ta n d a rd s for G overnm ent Agencies in proposing, a sse ssin g ,
2 m onitoring a n d ev alu atin g developm ent policies, p la n s a n d projects
3 including th o se financed by g ra n ts a n d co n cessio n al loans; a n d
4
5 (d) A ssist a n d s u p p o rt th e capacity building of RDCs a n d LGUs in
6 developm ent p lan n in g an d in v estm en t program m ing.
7
8 S e c tio n 12. H e a d s o f G o v e rn m e n t A g e n cie s. - The h e a d s of NGAs,
9 GOCCs a n d LGUs shall, in addition to resp o n sib ilities provided u n d e r
10 existing law s, be resp o n sib le for th e following:
11
12 (a) Keep th e DBM a n d DOF inform ed of significant ch an g e s, issu e s, an d
13 risk s th a t could im p a ct on th e fin an ces of th e governm ent;
14
15 (b) P articipate in th e p ro ce sses to develop th e M edium -term Fiscal
16 Strategy, th e B udget Priorities Fram ew ork, a n d th e Proposed N ational
17 B udget a s req u ired by th e DBM;
18
19 (c) M anage th e ir respective agencies, in cluding GOCCs, a n d o th er
20 re so u rce s placed u n d e r th e ir supervision, in a n efficient, effective a n d
21 econom ic m a n n e r in o rd er to deliver th e o u tp u ts a n d a tta in the
22 o u tcom es set in th e ir respective budgets;
23
24 (d) M onitor th e physical a n d financial im p lem en tatio n of th e ir program s,
25 activities a n d projects;
26
27 (e) Take a p p ro p ria te m e a su re s to e n su re th a t c a sh d isb u rse m e n ts a n d
28 c o n tra c tu a l co m m itm en ts do not exceed th e a m o u n ts a p p ro p ria te d in
29 th eir respective budgets;
30
31 (1) E n su re th a t th e ir respective agencies se ttle s all c o n tra c tu a l
32 co m m itm en ts or approves p ay m en t th ere o n w ithin th e tim e p rescrib ed
33 by law;
34
35 (g) In stitu te effective a n d efficient m an a g em en t sy stem s, p ro ced u re and
36 p ractices for a s s e ts , liabilities, a n d p erso n n el, in clu d in g in tern al
37 controls, risk m an ag em en t, a n d perform ance review;
38
39 (h) D em o n strate th a t d u e regard h a s been ta k e n on th e reco m m en d atio n s
40 provided in in te rn a l a n d ex tern al a u d it ev alu atio n rep o rts, to the
41 e x ten t a u th o rize d in th e ir respective budgets;
42
43 (i) Provide credible c a sh forecast for tim ely and a c c u ra te c ash
44 program m ing; a n d
45
46 (j) Provide a c c o u n tin g a n d rep o rtin g of public fin an ces th ro u g h the
47 in teg rated financial m an a g em en t inform ation sy stem a n d /o r o th er
48 p re p a rato ry online inform ation sy stem s a s req u ired in th is Act.
49
 1 S e c tio n 13. C a p a c ity D e v e lo p m e n t R e q u ire m e n ts o n P u b lic F in a n c ia l
2 M a n a g e m e n t. - The foregoing agencies shall c o n tin u e to form ulate capacity
3 developm ent re q u ire m e n ts on PFM a n d c o n d u c t tra in in g s on th e sam e. In
4 this regard, th e OCG sh all oversee the form ulation of th e said capacity
5 developm ent re q u ire m e n ts to e n su re alig n m en t of th e objectives.
6
7
8 PART III
9 FISCAL RESPONSIBILITY
10
11 S e c tio n 14. F is c a l R e s p o n s ib ility P rin c ip le s . - The S ta te sh all p u rs u e its
12 policy objectives in acco rd an ce w ith the following Fiscal R esponsibility
13 Principles:
14
15 (a) Im plem ent fiscal policies a n d strateg ies c o n siste n t w ith the
16 achievem ent of m acroeconom ic stability a n d inclusive econom ic
17 developm ent;
18
19 (b) M anage re so u rc e s in a fiscally a n d environm entally su s ta in a b le way;
20
21 (c) M aintain p ru d e n t levels of public debt;
22
23 (d) M aintain a n a p p ro p ria te b alan ce betw een governm ent rev en u es a n d
24 e x p en d itu res; a n d
25
26 (e) M anage fiscal risk s in a p ru d e n t m an n er.
27
28 S e c tio n 15. S t a te m e n t o f F is c a l P o licy . - The DBM, in co o rd in atio n w ith
29 DOF, NEDA a n d OP in the DBCC, shall p rep are, su b je ct to th e approval of
30 the P resident, th e S ta te m e n t of Fiscal Policy w hich shall co n ta in m ea su ra b le
31 m ed iu m -term m acroeconom ic a n d fiscal objectives a n d fo recasts c o n siste n t
32 w ith the Fiscal R esponsibility Principles a n d th e Long-Term Vision Report.
33

10
 The P resid en t sh all su b m it for inform ation of C ongress, th e S ta te m e n t of
2 Fiscal Policy n o t la te r th a n n inety (90) days u p o n c o m m en cem en t of h is /h e r
3 term of office a n d u p d a te th e m ea su ra b le fiscal objectives se t forth th erein
4 th ree (3) y e a rs th ereafter.
5
6 S e c tio n 16. M e d iu m -te rm F is c a l S tr a te g y .- The DBM, in coordination
7 with th e DOF, NEDA, a n d OP in the DBCC, sh all p rep a re, su b je ct to
8 approval of th e P resid en t, a M edium -term Fiscal S trategy a n d its a n n u a l
9 u p d a te s. The S trategy a n d its u p d a te s shall be c o n siste n t w ith th e approved
10 S ta te m en t of Fiscal Policy a n d Long-Term Vision R eport. It sh all include a
11 su m m ary of the fiscal policies for revenue, debt, deficit, ex p en d itu re, an d
12 fiscal risk m an a g em en t, su p p o rte d by a m ed iu m -term fiscal su sta in ab ility
13 an aly sis, c o n siste n t w ith th e m ea su ra b le fiscal objectives e sta b lish e d in the
14 approved S ta te m e n t of Fiscal Policy. The IRR of th is Act shall detail the
15 o th er specifications for th e M edium -term Fiscal S trategy a n d its u p d a te s.
16
17 The P resid en t sh all su b m it for th e inform ation of C ongress, th e M edium -
18 term Fiscal S trateg y for th e following fiscal y e ar n o t la te r th a n M arch 15 of
19 the c u rre n t y e a r an d shall publish the said report on a governm ent website
20 not later th a n seven (7) days after it is subm itted to Congress.
21
22 S e c tio n 17. F is c a l R e p o rts . - The DBM, in co o rd in atio n w ith the DOF,
23 NEDA, a n d OP in th e DBCC, shall produce a M id-year Fiscal R eport (MFR),'
24 covering th e first h a lf of th e c u rre n t fiscal y e ar a n d a n A n n u al Fiscal R eport
25 (AFR) on th e governm ent s m acroeconom ic a n d fiscal perform ance covering
26 the p receding fiscal year.
27
28 The MFR a n d AFR shall include inform ation on m acroeconom ic a n d fiscal
29 o u ttu rn s for th e period covered a s com pared a g a in st fo recasts a n d objectives
30 stated in the M edium -term Fiscal Strategy; a s well a s rep o rtin g on b udget
31 execution, a t lea st in th e aggregate a n d by agency level, com pared a g a in st
32 approved a p p ro p ria tio n s a n d o th e r sp en d in g a u th o ritie s. The IRR of th is Act
33 shall detail th e o th e r specifications for the c o n te n ts of th e MFR a n d AFR.
34
35 The P resid en t sh all su b m it th e MFR to C ongress n o t later th an
36 S eptem ber 30 of each y e a r while the AFR shall be su b m itte d together with
37 the Proposed N ational B udget. Said rep o rts shall be published on a
38 governm ent w ebsite not later th a n seven (7) days after they are subm itted to
39 Congress.
40
41 S e c tio n 18. L o n g -te rm V ision R e p o rt. - The NEDA, in co o rd in atio n with
42 the DOF, DBM a n d OP in the DBCC, shall su b m it a Long-term Vision
43 R eport to th e P re sid e n t a n d C abinet, a n d C ongress not la te r th a n O ctober
44 31 a n d Novem ber 30, respectively. Said R eport shall a s s e s s th e long-term
45 su sta in ab ility of existing governm ent policies over th e nex t twenty-five (25)
46 years, tak in g into a c c o u n t dem ographic, env iro n m en tal, a n d o th e r changes.
47

11
 1 The first L ong-term Vision R eport sh all be su b m itte d to th e P resid en t a n d
2 C abinet, a n d C ongress w ithin two (2) y e ars from th e effectivity of th is Act, to
3 be u p d a te d every six (6) y e a rs th ereafter.
4 The NEDA sh all c a u se th e p u b licatio n of th e Long-term Vision R eport on
5 a governm ent w ebsite no t later th a n seven (7) d ay s u p o n su b m issio n to
6 C ongress.
7 S e c tio n 19. D e v ia tio n s f r o m F is c a l O bjectives. — The governm ent m ay
8 deviate from the m ed iu m -term fiscal objectives in th e approved S ta te m e n t of
9 Fiscal Policy on a tem p o rary b asis, w here su c h deviation is d u e to a m ajor
10 n a tu ra l d isa ste r, u n a n tic ip a te d severe econom ic shock, or o th e r significant
11 unforeseeable event th a t c a n n o t be accom m odated th ro u g h accessin g the
12 C ontingent F u n d a n d /o r th e N ational D isa ste r Risk R eduction a n d
13 M anagem ent F u n d , a s m ay be applicable or p ru d e n t fiscal policy
14 a d ju stm e n ts, or th e u se of o th e r flexibilities provided in th is Act.
15
16 The P resid en t sh all su b m it a rep o rt to th e C ongress, sta tin g th e re a so n s
17 for any su c h deviations, th e p la n s a n d the expected tim e to a d d re ss su c h
18 deviations, a s p a rt of th e succeeding M edium -term Fiscal Strategy or its
19 a n n u a l u p d a te , or in th e M id-year or A nnual Fiscal R eport, w hichever is the
20 next rep o rt d u e a n d w ithin th e p rescrib ed period u n d e r th is Act.
21 S e c tio n 2 0 . S h a r e d F is c a l D isc ip lin e . - All proposed revenue eroding a n d
22 ex p en d iture bills shall include a F inancial a n d B udgetary Inform ation S heet
23 u p o n filing of th e bill co n ta in in g a n e stim ate of the financial a n d b u d g etary
24 im plications of said proposal for the initial y e ar of im p lem en tatio n a n d the
25 next five (5) years. E x p en d itu re bills refer to th o se w hich will re s u lt in a
26 red u ctio n of revenue collections or a n in crease in n a tio n al governm ent
27 ex p en d itu res, inclu d in g th o se m a n d a tin g th e creatio n of recu rrin g
28 ex p en d itures.
29 E ach H ouse of C ongress shall provide guidelines p rescrib in g th e form,
30 co n te n t of th e F inancial a n d B udgetary Inform ation S heet, a s well a s the
31 a p p ro p riate offices from w hich su c h inform ation sh all be acq u ired , a n d the
32 im plications of non-com pliance w ith said su b m issio n .
33 PART IV
34 BUDGET PREPARATION, EXECUTION, AND ADJUSTM ENT
35
36 S e c tio n 2 1 . G o v e rn in g P r in c ip le s in B u d g e t P r e p a r a t io n . - T here is
37 hereby e stab lish ed a se t of governing principles to be observed by th e NGAs,
38 GOCCs, a n d LGUs in th e p rep a ratio n of th eir a n n u a l b u d g et pro p o sals, an d
39 by the DBM in th e p rep a ra tio n , a n d th e p re se n ta tio n to C ongress, of the
40 Proposed N ational Budget:
41
42 (a) C a sh -b ased e stim a te s shall be ad o p ted in th e proposed general a n d
43 special a p p ro p ria tio n s bills to prom ote faster a n d m ore effective
44 delivery of services;
45
46 (b) The overall ex p en d itu re program of th e governm ent for a given fiscal
47 y ear sh all be included, identifying th o se req u irin g approval by
48 C ongress a n d th o se a u th o rized u n d e r existing laws;
49

12
 1 (c) All so u rc e s of fu n d s a n d a u th o rized u s e s available to th e agency shall
2 be co n sid ered in th e ev aluation of agency p ro p o sa ls a n d d eterm in atio n
3 of agency b u d g et levels, a n d sh all likewise be disclosed in the
4 Proposed N ational B udget a n d reports;
5
6 (d) E valuation of agency p ro p o sals m ay in clude th e an aly sis of a
7 developm ent p lan , m a s te r plan or road m ap, agency capability a s
8 d e m o n stra te d by previous y e a rs ’ perform ance, its c o n trib u tio n to
9 projects a n d activities of o th e r agencies, u tilizatio n of fu n d s
10 a p p ro p ria te d or released, a n d su c h o th e r criteria a s m ay be
11 d eterm ined by th e DBM. The perform ance sh all be ev alu ated b ased on
12 th e a c tu a l d isb u rse m e n ts a n d c o n tra c tu a l co m m itm en ts a s com pared
13 to th e ap p ro p ria tio n s;
14
15 (e) All a p p ro p ria tio n s sh all be valid for one fiscal y e a r i.e., from the
16 effectivity of th e a p p ro p ria tio n s a c t u n til th e en d of th e fiscal y ear
17 co ncerned w ith no provision for carryover, except for a th ree m o n th
18 E xtended P aym ent Period in the following fiscal y e ar to allow agencies
19 to settle p a y m e n ts for goods a n d services delivered d u rin g the
20 previous fiscal year;
21
22 (f) Item s of a p p ro p ria tio n s shall be p rese n te d in su c h a way a s to identify
23 both th e en tity resp o n sib le for th e ex p en d itu re a n d th e intended
24 re s u lts from th e u se of th e a p p ro p riatio n in o rd er to ev alu ate the
25 perform ance of th e agency;
26
27 (g) B oth th e financial a n d n o n-financial p erform ance of ag en ciessh all be
28 p resen te d in th e Proposed N ational B udget a n d th e G eneral
29 A p propriations Act to e n su re a perform ance-inform ed budget; a n d
30
31 (h) Item s of a p p ro p ria tio n s sh all be reflected by d e p a rtm e n t, agencies,
32 b u re a u s, a n d offices, a n d sh all be p resen te d for inform ation p u rp o se s,
33 by region a n d province, a n d eventually, by city or m unicipality.
34
35 S e c tio n 2 2 . P la n n in g -B u d g e tin g L in k a g e . - D evelopm ent strateg ies
36 identified in th e Philippine D evelopm ent Plan (PDP) sh all be a prim ary
37 co n sid eration in th e form ulation of th e b u d g et priorities fram ew ork. T hese
38 shall also be th e b a sis for draw ing u p strategic a n d prioritized p ro g ram s a n d
39 projects in the m u lti-y ear public in v estm en t program , w hich in tu rn will be
40 considered in th e form ulation of th e a n n u a l agency b u d g e ts th a t conform to
41 the a n n u a l b u d g et ceilings approved by the P resident.
42
43 The im p lem en tatio n of p ro g ram s a n d projects fu n d ed u n d e r th e a n n u a l
44 agency b u d g e ts sh all be m onitored to e n su re econom y, efficiency, an d
45 effectiveness in th e u se of public fu n d s. M onitoring a n d ev alu atio n of th ese
46 projects sh all cover, am ong o th ers, the p lan n ed a n d a c tu a l perform ance of
47 agencies, citing re a so n s for deviation a n d /o r poor ab sorptive capacities. The
48 re s u lts of th e project evalu atio n shall inform the a s s e s s m e n t of s u b s e q u e n t
49 p lan s an d b u d g et p ro p o sa ls of agencies.

13
 1
2 S e c tio n 2 3 . B u d g e t P r i o r i ti e s F ra m e w o rk . - The DBM, in coordination
3 with the DOF, NEDA a n d OP in th e DBCC, shall p re s e n t to the P residen t
4 an d C abinet, on or before April of each year, a B udget Priorities F ram ew ork
5 w hich shall guide th e form ulation of th e B udget for th e following y e a r by
6 co n tain ing th e m ed iu m -term fiscal strateg y a n d ta rg e ts u n d erly in g th e
7 budget; th e priority a re a s for governm ent sp en d in g reflected in th e PDP,
8 estim ated a m o u n t a n d p lan n e d allocation of th e fiscal space; a n d o th er
9 req u irem en ts laid dow n in th e IRR.
10
11 S e c tio n 2 4 . T he B u d g e t P r e p a r a t io n P ro c e s s . - The DBM sh all d eterm in e
12 the b u d g et p re p a ra tio n p ro cess an d calen d ar. The b u d g et p rep a ratio n
13 process shall cover: (i) NGAs; (ii) GOCCs w ith re sp e c t to th e ir im p act on
14 revenues, e x p en d itu re s, a sse ts, a n d liabilities a n d risk s of th e governm ent;
15 an d (iii) LGUs a s to th e ir im p act on rev en u es a n d e x p e n d itu re s of the
16 governm ent.
17
18 S e c tio n 2 5 . T he P ro p o s e d N a tio n a l B u d g e t. - The P resid en t sh all su b m it
19 to C ongress, n o t later th a n th irty (30) days from th e fourth M onday of J u ly
20 of every year, th e Proposed N ational B udget, w hich shall be th e b a sis of the
21 G eneral A ppropriations Bill.
22
23 The P resid en t sh all determ in e th e form a n d c o n te n t of th e Proposed
24 N ational B udget w hich shall include, b u t not lim ited, to th e following:
25
26 (a) P re sid e n t’s B udget M essage -p ro v id es a preview of th e Proposed
27 N ational B udget, explaining th e principles, objectives a n d policy
28 fram ew ork a d o p ted a n d th e sp en d in g priorities for th e fiscal year;
29
30 (b) B udget of E x p en d itu re s a n d S ources of F in an cin g (BESF) -c o n ta in s
31 the m acroeconom ic p a ra m eters; d im en sio n s of th ree -y ea r (3-year)
32 e x p en d itu re program , revenues, financing, a n d o u tsta n d in g debt;
33 overview of th e financial p o sitio n s of GOCCs, LGUs, a n d public-private
34 p a rtn e rsh ip projects, a s well a s th e o th e r item s listed in th e IRR;
35
36 (c) N ational E x p en d itu re Program (NEP) - in clu d es th e strateg ic
37 objectives, d e ta ils of the th ree -y ea r (3-year) ex p en d itu re program ,
38 perform ance inform ation, su c h a s key strateg ies, o u tp u ts a n d
39 o u tco m es for agencies in relation to th e ir b u d g ets, a n d staffing
40 sum m ary;
41
42 (d) Fiscal Risk S ta te m e n t - p re s e n ts a consolidated sta te m e n t of th e fiscal
43 risk s th a t th e n a tio n al governm ent faces, inclu d in g th o se from the
44 co n tin g en t liabilities of G overnm ent Agencies a n d o th e r item s listed in
45 the IRR.
46
47 As required u n d e r Section 17 of th is Act, th e P re sid e n t sh all likewise
48 su b m it for c o n sid era tio n of C ongress, the A nnual Fiscal R eport for the
49 preceding fiscal y e a r n o t la te r th a n th e abovem entioned date, a n d th e Mid-

14
 1 y ear Fiscal R eport for th e c u rre n t y e ar n o t later th a n S ep tem b er 30 of every
2 year.
3
4 C ongress m ay n o t in crease th e a p p ro p ria tio n s recom m ended by the
5 P resid ent for th e o p e ra tio n s of governm ent a s specified in th e Proposed
6 N ational B udget.
7
8 The P resid en t sh all p u b lish th e Proposed N ational B udget on a
9 G overnm ent w ebsite on th e sam e day a s it is p rese n te d to C ongress.
10
11 S e c tio n 2 6 . P r o g r a m C la s s if ic a tio n . - The Proposed N ational B udget shall
12 ad o p t a s tru c tu re b ased on a program classification th a t g ro u p s line item s
13 u n d e r the objectives or ou tco m es to w hich they c o n trib u te to. Perform ance
14 inform ation shall be provided for each program to facilitate th e ev aluation of
15 the cost effectiveness of the pro g ram s a n d provide b e tte r inform ation for
16 an aly sis a n d feedback for p la n n in g a n d prioritization of e x p en d itu re s.
17
18 S e c tio n 2 7 . L u m p S u m A p p r o p r ia tio n s . - To prom ote the tra n s p a re n t a n d
19 detailed d isclo su re of all proposed governm ent sp en d in g , lu m p sum
20 ap p ro p ria tio n s a n d special p u rp o se fu n d s (SPFs) in th e Proposed N ational
21 B udget shall be lim ited to: (1) th e N ational D isa ste r Risk R eduction a n d
22 M anagem ent F u n d (NDRRMF); (2) the C ontingent F und; (3) S ta tu to ry S h a re s
23 of LGUs; a n d (4) o th e r SPFs n o t falling u n d e r a n y of th e preceding p u rp o se s
24 an d the details of w hich could not be d eterm in ed d u rin g the b udg et
25 p rep a ratio n stage.
26
27 S e c tio n 2 8 . N a tio n a l D i s a s te r Risk. R e d u c tio n a n d M a n a g e m e n t F u n d .
28 - T h e NDRRMF shall be u se d for: (1) d isa ste r risk red u c tio n or m itigation,
29 prevention a n d p re p a re d n e ss activities, su c h as, b u t n o t lim ited to, train in g
30 of p erso nnel, p ro c u re m e n t of eq u ip m en t, a n d cap ital ex p en d itu re s; a n d (2)
31 relief, recovery, re c o n stru c tio n a n d o th e r w ork or services in connection with
32 n a tu ra l or h u m a n in d u ced calam ities w hich m ay o c cu r d u rin g th e b udg et
33 year or those th a t o ccu rred in th e preceding two (2) years.
34
35 The NDRRMF m ay include the Q uick R esponse F u n d (QRF) of agencies,
36 w hich shall be u se d a s a sta n d b y fund in o rd er th a t th e situ a tio n a n d living
37 conditions of people in c o m m u n ities or a re a s strick e n by calam ities,
38 epidem ics, crises, a n d c a ta s tro p h e s m ay be norm alized a s quickly a s
39 possible. The QRF shall be released directly to th e agencies co n cern ed u p o n
40 approval of th e DBM.
41
42 R eleases from th e NDRRMF, o th er th a n the QRF, shall be su b je ct to the
43 prior approval of the P resident, who m ay tak e into c o n sid eratio n the
44 reco m m endation of th e N ational D isa ste r Risk R eduction a n d M anagem ent
45 Council a n d th e a p p ro p ria te agency for local a n d in te rn a tio n a l d isa ste rs an d
46 calam ities.
47
48 S e c tio n 2 9 . C o n tin g e n t F u n d . - The C on tin g en t F u n d sh all cover the
49 funding re q u ire m e n ts of new a n d /o r u rg e n t projects a n d activities of

15
 1 n atio n al governm ent agencies a n d GOCCs th a t need to be im plem ented or
2 paid d u rin g th e year, su c h a s, legal obligation of th e governm ent arisin g
3 from final a n d executory d ecisions by co m p e te n t a u th o rity , including
4 a rb itratio n aw ard s, m ediation settlem en t, or com prom ise ag reem en ts,
5 req u irem en ts of newly created offices, or deficiencies in th e a p p ro p ria tio n s
6 for local a n d e x tern al travels of the P resid en t of the P hilippines.
7
8 R eleases from the C ontin g en t F u n d shall be su b je c t to approval by the
9 P resid ent of th e P hilippines, o th er th a n p ay m en t re su ltin g from final an d
10 executory decisions pro m u lg ated by co m p eten t a u th o ritie s, w hich sh all be
11 su b ject to approval by th e DBM.
12
13 The DBM sh all inform C ongress of all rele ases from th e C o n tin g en t F u n d
14 in the q u arterly a n d a n n u a l fiscal rep o rts in cluding inform ation on th e d ate
15 of release, th e a m o u n t covered, co rresp o n d in g p u r p o s e /s a n d recipient
16 agency.
17
18 S e c tio n 3 0 . S t a t u t o r y S h a r e s o f L o c a l G o v e rn m e n t U n its. - The sh a re s
19 of LGUs in th e pro ceed s from n atio n al tax es a n d o th e r tra n s fe rs to LGUs
20 au th o rized by law sh all be released to th e LGUs in a cc o rd an ce w ith the
21 provisions on th e u se , allocation, a n d release of th e fu n d s a s m ay be
22 provided in p e rtin e n t law s, ru les a n d regulations.
23
24 S e c tio n 3 1 . U n p ro g ra m m e d A p p r o p r ia tio n s . - C ongress m ay authorize
25 stan d b y a p p ro p ria tio n s to cover the funding re q u ire m e n ts of o th e r priority
26 projects a n d activities or contingencies, a s well a s provide a p p ro p ria tio n s
27 cover for fo reig n -assisted projects (FAPs) no t specifically included in the
28 program m ed c o m p o n en t of the A ppropriations Law. The U nprogram m ed
29 A ppropriations sh all have th e sam e level of d e tails a s in th e program m ed
30 com p o n ent of th e A ppropriations Law. The a m o u n t a u th o rize d u n d e r the
31 U nprogram m ed A ppropriations shall n o t exceed two p e rc en t (2%) of th e total
32 proposed ex p en d itu re in th e program m ed co m p o n en t of th e A ppropriations
33 Law.
34
35 The U nprogram m ed A ppropriations sh all tak e effect only w hen su p p o rted
36 by excess collections g en erated in any one of th e p a rtic u la r tax or n o n -tax
37 revenue source from its co rresp o n d in g revenue collections ta rg e t in the
38 BESF a s certified by th e BTr, or w hen th ere are new loan ag re em e n ts for
39 FAPs. In no case sh all the U nprogram m ed A ppropriations be activated or
40 released w hen th ere is a risk of b reach in g th e m ea su ra b le fiscal objectives
41 for the b u d g et b a lan ce (including a deficit) or d eb t for the financial y e ar or
42 fu tu re y e ars a s provided in th e S tatem en t of Fiscal Policy a n d M edium -term
43 Fiscal S trategy or if th ere is a risk of b reach in g an y of th e Fiscal
44 R esponsibility Principles.
45

16
 1 Priority p ro jects a n d activities or contin g en cies sh all p e rta in to
2 ex p en d itu res, th e p a y m e n t of w hich are n o t covered u n d e r th e C onting en t
3 F u n d an d could n o t be delayed u n til th e su cceed in g b u d g e t y e a rs w itho u t
4 h arm in g public in te re s t or a risin g from th e g o v ern m en t’s legal obligation
5 su c h a s com pliance w ith a governm ent g u a ra n te e or se ttle m e n t of final an d
6 executory decisions by c o m p eten t au th o ritie s.
7
8 R eleases from th e U nprogram m ed A ppropriations sh all be su b je ct to the
9 prior approval of th e P resid en t of the P hilippines, o th e r th a n final an d
10 executory decisions, w hich shall be su b je ct to approval of th e DBM.
11
12 The DBM sh all inform C ongress of all rele ases from th e U nprogram m ed
13 A ppropriations in th e q u a rte rly a n d a n n u a l rep o rts inclu d in g inform ation on
14 the d ate of release, th e a m o u n t covered, c o rresp o n d in g p u rp o s e /s a n d
15 recipient agency.
16
17 S e c tio n 3 2 . B u d g e t w ith A c c o u n t C odes. - All item s of a p p ro p ria tio n s in
18 the A ppropriations Law shall be given a c c o u n t codes p u r s u a n t to th e Unified
19 A ccount Code S tru c tu re th a t ap p lies to all th e a s s e ts , liabilities, equities,
20 incom e, a n d e x p en ses of th e governm ent. T his a c c o u n t code s tru c tu re shall
21 be u sed in the release of th e a p p ro p ria tio n s in th e A ppropriations Law for a
22 unified acco u n tin g , a u d itin g an d reporting of all the financial tra n s a c tio n s of
23 the governm ent.
24
25 S e c tio n 3 3 . R e e n a c te d B u d g e t. - If, by th e end of a n y fiscal year.
26 C ongress shall have failed to e n a c t the G eneral A ppropriations Bill for the
27 en su in g fiscal year, th e G eneral A ppropriations Law for th e preceding fiscal
28 year shall be deem ed re-e n ac ted a n d shall rem ain in force a n d effect u n til
29 the said G eneral A pp ro p riatio n s Bill is p a sse d by th e C ongress.
30 C o n sisten t w ith th e Fiscal R esponsibility P rinciples, the Re­
31 en acted B udget sh all be enforced a s follows:
32
33 (a) The aggregate level of th e R e-enacted B udget sh all be lim ited to the
34 total a m o u n t a p p ro p ria te d in the preceding y e a r’s A ppropriations
35 Law, b u t shall in no case exceed th e level of th e so u rc es of financing
36 u n d e r th e BESF of th e Proposed N ational B udget;
37
38 (b) The a p p ro p ria tio n s for the following shall be lim ited to th e a m o u n t
39 a u th o rized u n d e r the R e-enacted B udget, b u t in no c ase exceed the
40 a m o u n t proposed by th e P resid en t in the Proposed N ational Budget:
41
42 1. O ngoing p ro g ram s, projects a n d activities;
43 2. P ersonnel benefits, including retire m e n t g ra tu itie s, p en sio n s,
44 term in al leave pays a n d related expenses;
45 3. NDRRMF, C o n tin g en t F u n d , S ta tu to ry S h a re s of LGUs, an d
46 o th e r SPFs; a n d
47 B udgetary s u p p o rt to GOCCs for th e ir o p eratio n al req u ire m e n ts.
48

17
 1 (c) In no case sh all th e following be considered p a rt of th e R e-enacted
2 Budget:
3
4 1. C om pleted p rogram s, projects a n d activities fu n d ed in th e
5 G eneral A ppropriation Law for th e preceding fiscal year;
6 2. B udgetary s u p p o rt for GOCCs for s u p p o rt to p rogram s,
7 activities or projects; a n d
8 3. E quity c o n trib u tio n of th e N ational G overnm ent to GOCCs.
9
10 The item s a n d /o r a m o u n t of a p p ro p ria tio n s n o t covered u n d e r the Re­
11 en acted B udget a s provided above sh all not be released, d isb u rse d ,
12 or utilized for th e p u rp o se previously au thorized.
13
14 The DBM sh all issu e guidelines on th e aggregate a n d agency levels of
15 ap p ro p ria tio n s au th o rize d u n d e r the R e-enacted B udget in a cco rd an ce w i:h
16 th e foregoing, su p p o rtin g req u ire m e n ts to determ in e a c tu a l needs, a n d o th er
17 p e rtin e n t ru le s in th e im plem en tatio n of the R e-enaeted B udget.
18
19 Upon e n a c tm e n t of th e G eneral A ppropriations Law anytim e d u rin g th e
20 c u rre n t fiscal year, all releases u n d e r a R e-enacted B udget c o n siste n t w ith
21 th is Section shall be deem ed to have been im plem ented p u r s u a n t to, an d
22 charged a g ain st, for a c c o u n t recording p u rp o se s, the G eneral A ppropriations
23 Law for th e c u rre n t fiscal year.
24
25 S e c tio n 3 4 . S p e c ia l A p p r o p r ia tio n s B ill. - A Special A ppropriations Bill
26 is a proposal su b m itte d by th e P resident, a s reco m m en d ed by th e DBM,
27 before C ongress to provide a u th o riza tio n for e x p e n d itu re s for a specific
28 p u rp o se n o t in clu d ed or n o t covered u n d e r th e a n n u a l a p p ro p ria tio n s laws.
29 It shall specify th e p u r p o s e /s for w hich it is in te n d ed a n d be valid u n til the
30 end of th e fiscal y e ar of its e n ac tm en t.
31
32 A Special A ppropriations Bill shall be su p p o rte d by fu n d s actu ally
33 available or those w hich are not included in th e fiscal y e a r’s so u rc es of
34 financing u n d e r th e BESF a s certified by th e N ational T re a su re r, or to be
35 raised by a c o rresp o n d in g revenue m ea su re proposed th erein . The a m o u n t
36 to be a u th o rized by C ongress in a Special A ppropriations Bill m ay be m ore
37 th a n th a t originally proposed for a s long a s the sam e is su p p o rte d by an y or
38 a com b ination of th e above so u rc es a n d is c o n siste n t w ith th e Fiscal
39 R esponsibility P rinciples a n d th e M edium -term Fiscal Strategy. A Special
40 A ppropriations Bill m ay only be proposed after th e p a ssa g e of th e G eneral
41 A ppropriations Law, except for the following: (1) d isa ste r-re la te d p u rp o ses;
42 (2) u rg e n t projects a n d /o r activities; a n d (2) u n fo resee n re q u ire m e n ts of the
43 governm ent.
44
45 A Special A ppropriations Bill m ay likewise refer to a p roposal su b m itte d
46 by the P resid en t, a s recom m ended by the DBM, before C ongress for
47 additional a p p ro p ria tio n s for existing or new pro g ram s, activities or projects
48 of a n NGA or GOCC w ith fast in-year d isb u rse m e n t rate. In th is case, th e
49 bill m ay be su p p o rte d by th e c u rre n t fiscal y e a r’s so u rc e s of financing a s

18
 1 certified by th e N ational T re a su re r d u e to reversion of fu n d s of NGAs or
2 GOCCs re su ltin g from slow im p lem en tatio n of p ro g ram s, activities o r
3 projects.
4
5 S e c tio n 3 5 . R e le a s e a n d E x p e n d itu r e o f P u b lic F u n d s . —The governm ent
6 shall com m ence rele ases of Public F u n d s covered by a n A ppropriations Law
7 a s soon a s su c h Law com es into force to e n su re tim ely a n d efficient
8 d isb u rse m e n t by th e a p p ro p ria te im plem enting agencies, su b je ct to
9 p e rtin en t b u d g etin g a n d a u d itin g ru le s a n d reg u latio n s. U pon th e
10 im plem entation of c a sh -b a se d ap p ro p ria tio n s, th e A pp ro p riatio n s Law shall
11 be considered th e a u th o rity of th e agencies to c o n tra c t o u t a n d d isb u rse
12 fu n d s, except for in sta n c e s provided in th e IRR.
13
14 S e c tio n 3 6 . A v a ila b ility o f C a sh -B a se d A p p r o p r ia tio n s . - All
15 a p p ro p riatio n s sh all be available for release, c o n tra c tu a l c o m m itm en t an d
16 d isb u rse m e n t u n til th e end of the fiscal year. However, G overnm ent
17 Agencies m ay still d isb u rse fu n d s n o t la te r th a n the th ree (3) m o n th s
18 E xtended P ay m en t Period from th e end of th e fiscal y e a r for goods or
19 services w hich have already been delivered or ren d e red w ithin th e fiscal
20 year. Said p a y m e n ts sh all be charg eab le a g a in st th e au th o rized
21 ap p ro p ria tio n s of the said preceding fiscal year.
22
23 S e c tio n 3 7 . M u lti-y e a r C o n tra c ts . - The DBM sh all identify th e
24 req u irem en ts a n d /o r p rescrib e guidelines before agencies m ay e n te r into
25 m ulti-year c o n tra c ts su c h a s th e issu a n c e of a M ulti-year C o n trac tu a l
26 A uthority (MYCA).
27
28 In the c ase of GOCCs, they shall secu re prior a u th o rity from their
29 respective governing b o a rd s before en terin g into m u lti-y ear c o n tra cts.
30
31 For solicited m u lti-y ear Public-Private P a rtn e rsh ip p ro jects approved
32 u n d e r Republic Act (R.A.) No. 6957, a s am en d ed by R.A. No. 7718, the
33 N ational G overnm ent responsibility shall be covered by a letter of
34 com m itm ent issu e d in acco rd an ce w ith the guidelines issu e d by th e DBM.
35
36 In all in sta n c e s, th e d isb u rse m e n ts to be in c u rre d for m ulti-year
37 c o n tra cts sh all in no c ase exceed the c a sh a p p ro p ria tio n s for th e p u rp o se
38 d u rin g the year. P ro c u rem e n t of m u lti-y ear projects sh all be su b je c t to the
39 provisions of R.A. No. 9184 a n d its IRR a n d th e guidelines issu e d by the
40 G overnm ent P ro c u rem e n t Policy B oard (GPPB).
41
42 S e c tio n 3 8 . E a r ly P r o c u r e m e n t A c tiv itie s. - To e n su re full b u d g et
43 utilization, tim ely c o n tra c t im p lem en tatio n a n d efficient delivery of services,
44 agencies are au th o rize d to u n d e rta k e p ro c u re m e n t activities from p re ­
45 p ro cu rem en t conference u n til p ost-qualification of bids b a sed on th eir
46 proposed b u d g et in th e NEP, COBs or A ppropriations O rd in an ce, in
47 accordance w ith th e guidelines issu e d by the GPPB.
48

19
 1 For m u lti-y ear p rojects, th e issu a n c e of a MYCA by th e DBM is required
2 prior to co m m en cem en t of a n y p ro cu re m en t activity. All existing M ulti-Year
3 O bligational A uthority sh all be u n d e rsto o d to refer to MYCA.
4
5 Agencies m ay only proceed w ith th e aw arding of c o n tra c t u p o n approval
6 or e n a c tm e n t of th e ir respective a p p ro p ria tio n s or b u d g e t au th o riza tio n
7 d o cu m ent, a s th e case m ay be, a n d b ased on th e a m o u n t authorized
8 therein.
9
10 S e c tio n 3 9 . Im p o u n d m e n t o f A p p r o p r ia tio n s . - The P re sid e n t of the
11 Philippines, u p o n reco m m en d atio n of the DBM m ay propose th e rescissio n
12 of a p p ro p ria tio n s from b oth h o u se s of C ongress, u n d e r an y of th e following;
13
14 (a) If the a p p ro p ria tio n s are no longer req u ired to fulfill th e objectives
15 originally so u g h t to be achieved by th e p ro g ram s, activities a n d
16 projects covering th e sam e; or
17 (b) In case of a n u n m a n a g e a b le N ational G overnm ent b u d g et deficit.
18 U nm anageable N ational G overnm ent b u d g et deficit a s u se d in th is
19 section shall be c o n stru e d to m ean th at: (i) the a c tu a l N ational G overnm ent
20 budget deficit h a s exceeded th e q u a rte rly b u d g et deficit ta rg e ts c o n siste n t
21 with the full-year targ et deficit a s indicated in th e BESF su b m itte d by the
22 P resid en t to C ongress p u r s u a n t to Section 22, Article Vll of th e C onstitutio n ;
23 or (ii) th ere are clear econom ic in d icatio n s of a n im pending o ccu rren ce of
24 su c h condition, a s d eterm in ed by the DBCC a n d approved by th e P resident.
25
26 Both H ouses of C ongress shall a c t on the proposed rescissio n w ithin
27 forty-five (45) d ay s after the receipt of th e im p o u n d m e n t pro p o sal from the
28 P resid en t by issu in g a jo in t Im p o u n d m e n t R esolution. W ithin the sam e
29 period of forty-five (45) c a le n d a r days, th e a p p ro p ria tio n s covered by the
30 Im p o u n d m en t P roposal sh all not, in any way, be rescin d ed in relation to the
31 p u rp o se s a n d objectives for w hich it w as a p p ro p ria te d . C ongressional
32 inaction after th e 4 5 -d ay period, is equiv alen t to a n approval of the
33 im p o u n d m e n t proposal.
34
35 Im pounded fu n d s sh all revert to th e N ational T rea su ry a n d sh all n o t
36 th ereafter be available for ex p en d itu re except by s u b s e q u e n t legislative
37 en actm en t.
38
39 S e c tio n 4 0 . A u th o r ity to D e c la re a n d Use S a v in g s . - The P resid en t of the
40 Philippines, th e P resid en t of the S enate of the Philippines, th e S p eak er of
41 the H ouse of R ep resen tativ es, the C hief J u s tic e of th e S u p rem e C ourt, the
42 O m b u d sm an , th e H eads of the Civil Service C om m ission, th e C om m ission
43 on Elections, a n d the COA are hereby a u th o rized to d eclare a n d u se savings
44 in th eir respective a p p ro p ria tio n s to a u g m e n t a c tu a l deficiencies in cu rre d for
45 the c u rre n t y e a r in an y item of th eir respective a p p ro p ria tio n s. An item of
46 ap p ro p riatio n sh all p e rta in to the a m o u n t a p p ro p ria te d for a program ,
47 activity or project in th e A ppropriations Law. In th e c ase of p ro g ram s w ith
48 several activities a n d /o r projects, each activity a n d /o r project sh all be
49 considered a n item of ap p ro p riatio n .

20
 1
2 The foregoing c o n stitu tio n a l officers a u th o rized to u se savings shall be
3 responsible for e n su rin g th a t a sem estra l a n d a n n u a l rep o rt on th eir
4 respective u se of savings sh all be su b m itte d to th e P re sid e n t of th e S en ate of
5 the Philippines a n d th e S p eak er of th e H ouse of th e R epresentatives, copy
6 fu rn ish ed th e DBM. The rep o rt shall indicate am ong o th e rs, th e a m o u n t of
7 savings g en erated , th e so u rc e s a n d g ro u n d s u se d therefor, a n d th e existing
8 program , activity or project in th e ir respective a p p ro p ria tio n s au g m en ted .
9 They shall likewise e n su re th a t said rep o rts are posted on th e ir respective
10 w ebsites.
11
12 The DBM sh all d eterm in e th e p rocedure, a s well a s th e su p p o rtin g
13 d o c u m e n ts n eeded in th e d eclaratio n a n d u se of savings au th o rize d in th is
14 Act.
15
16 S e c tio n 4 1 . M e a n in g o f S a v in g s . - Savings refer to p o rtio n s or b a la n ce s of
17 any released a p p ro p ria tio n s in th is Act w hich have n o t been obligated a s a
18 resu lt of an y of th e following:
19
20 (a) C om pletion, final d isc o n tin u a n c e , or a b a n d o n m e n t of a program ,
21 activity or p roject for w hich th e ap p ro p ria tio n is au th o rized ; or
22
23 (b) Im plem entation of m e a su re s resu ltin g in im proved sy stem s an d
24 efficiencies a n d th u s enabled a n agency to m eet a n d deliver the
25 required or p la n n e d targ e ts, p ro g ram s a n d services approved in th is
26 Act a t a lesser cost.
27
28 In case final d isc o n tin u a n c e or a b a n d o n m e n t is u se d a s b a sis in th e
29 declaration of savings, su c h d isc o n tin u ed or a b a n d o n e d program , activity or
30 project shall no longer be proposed for funding in th e n ex t two (2) fiscal
31 years.
32
33 A llotm ents th a t w ere n o t obligated d u e to th e fau lt of th e agency
34 concerned shall no t be co n sid ered savings.
35
36 S e c tio n 42. R u le s o n A u g m e n ta tio n . - A ugm entation is th e a c t of the
37 c o n stitu tio n al officers au th o rize d to u se savings in th e ir respective
38 ap p ro p ria tio n s to cover a deficiency in any existing program , activity or
39 project w ithin th e ir respective offices. A deficiency in a program , activity or
40 project m ay re s u lt from:
41
42 (a) U nforeseen m odifications or a d ju s tm e n ts in th e program , activity or
43 project; or
44 (b) R e -a sse ssm e n t in th e u se , prioritization a n d /o r d istrib u tio n of
45 reso u rces.
46 The p a rtic u la rs of th e e x p e n d itu re s to be fun d ed from savings sh o u ld be
47 w ithin the scope of, or covered by a n existing program , activity or project.
48 The existence of a program , activity or project reg ard less of th e availability of
49 allo tm en t c la s s /e s is sufficient for the p u rp o se of a u g m e n ta tio n .

21
 1
2 In no case sh all a n o n -e x iste n t program , activity or project be fun d ed by
3 au g m e n ta tio n from savings or by th e u se of a n a p p ro p ria tio n s otherw ise in
4 th is Act.
5
6 S e c tio n 4 3 . R u le s o n M o d ific a tio n in th e A llo tm e n t. - M odification in the
7 allotm ent is th e lim ited flexibility given to NGAs to m odify or ch an g e th e
8 allo tm ent w ithin a n existing program , activity or project w hich shall n o t
9 en tail any a u g m e n ta tio n of the a m o u n t a p p ro p ria te d for th e said program ,
10 activity or project d u rin g b u d g et execution. In th e case of p ro g ram s will"
11 several activities a n d /o r projects, m odification m ay only be u n d e rta k e n
12 w ithin each activity a n d /o r project.
13
14 M odification in th e allo tm en t m ay be u n d e rta k e n in an y of th e c a se s
15 specified in th e ru le s a n d reg u latio n s issu e d by th e DBM to e n su re th e
16 uniform im p lem en tatio n am ong th e v ario u s b ra n c h e s of governm ent, th e
17 pro p er recording of m odifications, a n d the tim ely su b m issio n of rep o rts by
18 all the offices concerned.
19
20
21 PART V
22 FINANCIAL MANAGEMENT
23
24 S e c tio n 4 4 . G e n e ra l F u n d . - All m onies received by NGAs, w h e th er
25 com ing from taxes, fees, ch arg es, penalties, incom e, dividends, in te re st
26 earn in g s, loan proceeds, g ra n ts, d o n a tio n s, a s s e t sale pro ceed s a n d su c h
27 o th er receivables, sh all a cc ru e to th e G eneral F u n d a n d be rem itted to the
28 N ational T reasu ry , u n le s s otherw ise provided by law or stip u la te d by
29 covering loan or g ra n t ag reem en ts. M onies u n d e r th e G eneral F u n d sh all be
30 m ade available to s u p p o rt the re q u ire m e n ts of th e N ational G overnm ent
31 au th o rized in a n A ppropriations Law.
32
33 A Special A ccount in the G eneral F u n d (SAGF) sh all be e stab lish ed by
34 law only u n d e r exceptional e irc u m sta n e e s to record tax es, fees, charges,
35 penalties, incom e, dividend, in te re st earn in g s, g ra n ts, a n d d o n a tio n s
36 collected, e a rn e d or received by NGAs for specified p u rp o se s. All laws
37 au th o rizin g th e e sta b lis h m e n t of SAGFs sh all specify th e period of u se
38 thereof w hich sh all n o t exceed th ree (3) y ears, or if no period is specified,
39 shall be deem ed to be u n til th e fulfilm ent of th e p u rp o se for w hich th e SAGF
40 w as au th o rized or for th ree y ears, w hichever com es earlier. All in te re sts
41 earn ed by SAGFs shall a cc ru e to the G eneral F und. The b a lan ce of SAGFs
42 u p o n th eir term in a tio n sh all form p a rt of the G eneral F und.
43
44 All e a rm ark e d rev en u es w ith significant inflows, a large portion of w hich
45 are n o t or not expected to be program m ed for d is b u rs e m e n t d u rin g th e year
46 shall be trea te d a s T ru st F u n d s a n d recorded a s tr u s t receipts. Proceeds
47 from th ese T ru st F u n d s shall be recorded only a s rev en u e inflow in the
48 G eneral F u n d w hen program m ed to be sp e n t for th e year.
49

22
 1 The P e rm an e n t C om m ittee c reated u n d e r Executive O rd er No. 292, s.
2 1987 shall recom m end for approval of the P resid en t th e ch an g e in the
3 tre a tm e n t of existing SAGFs th a t sh all be converted into T ru st F u n d s by
4 virtue of the foregoing. The recording of revenue inflows from th ese SAGF's
5 shall be governed by th e guidelines to be issu e d by th e P erm an en t
6 C om m ittee.
7
8 S e c tio n 4 5 . S p e c ia l F u n d s . - In exceptional c a se s w hen a SAGF is not
9 su itab le for th e o p e ra tio n s of a fund, Special F u n d s sh all be a u th o rized by
10 law an d lim ited to the following:
11
12 (a) T ru st F u n d - c o n stitu te d from identified revenue so u rc e s a n d o th er
13 receipts by NGAs or public officials a ctin g a s tru s te e s , a g en ts, or
14 a d m in istra to rs for th e fulfillm ent of co m m itm en ts or acco m p lish m en t
15 of specified p u rp o se s. T ru st F u n d s shall be dep o sited in th e TSA;
16
17 (b) Revolving F u n d - c o n stitu te d from receipts derived from b u sin e ss-ty p e
18 activities of NGAs to be u se d for th e o p eratin g re q u ire m e n ts of said
19 b u sin e ss-ty p e activities a n d a s su c h are considered self-liquidating
20 Revolving F u n d s sh all be deposited in th e TSA or in a n A uthorized
21 G overnm ent D epository B an k (AGDB) u p o n a u th o rity of th e N ational
22 T reasu rer; a n d
23
24 (c) R etained F u n d — c o n stitu te d from taxes, fees, c h arg es, penalties,
25 incom e, dividends, or in te re st e a rn in g s collected, e a rn e d or received
26 by NGAs w hich a re expressly a u th o rized by law to be retain ed by
27 NGAs a n d utilized for specified p u rp o se s. R etained F u n d s shall be
28 deposited in th e TSA or in a n AGDB u p o n a u th o rity of th e N ational
29 T reasu rer.
30
31 N o tw ithstanding th e provisions of law s to th e c o n trary . Special F u n d s
32 m ay only be e sta b lish e d after ev aluation by th e P e rm a n e n t C om m ittee, a s to
33 th eir p roper category a n d com pliance w ith th e foregoing conditions. Any
34 in te rest e arn ed by Special F u n d s shall a cc ru e to said F u n d s.
35
36 S e c tio n 4 6 . R ev iew by th e P e r m a n e n t C o m m itte e . - The P e rm an e n t
37 C om m ittee sh all review all existing SAGFs a n d Special F u n d s to validate
38 th eir com pliance w ith th e foregoing req u irem en ts. U pon ev aluation, the
39 P erm an en t C om m ittee sh all recom m end for approval of th e P resid en t the
40 m odification a n d /o r term in a tio n of said fu n d s a s m ay be n ecessary .
41
42 It sh all likewise review all SAGFs created u p o n th e p a ssa g e of th is Act
43 a n d m ay recom m end to extend th eir validity period, b u t in no case shall the
44 extension exceed th ree (3) y e a rs a t an y one tim e, su b je c t to approval of the
45 President.
46
47 The P e rm a n e n t C om m ittee shall Jointly issu e guidelines for the
48 e stab lish m en t, review a n d evaluation, a c c o u n tin g a n d reporting, a n d
49 term in atio n of SAGFs a n d Special F u n d s.

23
 1
2 S e c tio n 4 7 . E s c ro w F u n d . - E scrow F u n d s a re c o n stitu te d from fu n d s for
3 w hich the g o v ern m en t’s legal rig h t to u se is co n tin g en t u p o n a fu tu re event
4 w hich m ay or m ay n o t occur. E scrow F u n d s sh all be d ep o sited in the TSA or
5 an AGDB u p o n a u th o rity of th e N ational T rea su rer, a n d sh all su b seq u e n tly
6 be p a rt of th e G eneral F u n d u p o n th e o ccu rren ce of th e fu tu re co n tin g en t
7 event. Any in te re s t e a rn e d by a n Escrow F u n d sh all a c c ru e to the said
8 Fund. The a m o u n ts u n d e r escrow , including in te re s t e a rn e d sh all form p a rt
9 of the G eneral F u n d u p o n th e o ccu rren ce of th e fu tu re c o n tin g en t event.
10
11 S e c tio n 4 8 . W aiver, A b a te m e n t, R e fu n d a n d C o m p ro m ise A g re e m e n ts . -
12 No public official sh all waive, a b ate, refund, or e n te r into a com prom ise
13 ag reem ent on a tax liability or th e p ay m en t of fees or c h a rg e s except in
14 accordance w ith law. All w aivers, a b a te m e n ts, re fu n d s or com prom ise
15 ag reem en ts m ade by a n NGA sh all be properly a c c o u n te d for a n d reported.
16 Refund of tax es a n d o th e r rev en u es shall be tre a te d a s a red u ctio n in
17 revenue collections.
18
19 S e c tio n 4 9 . G ra n ts . - NGAs m ay accept, w ith prior c o o rd in atio n w ith DOF,
20 g ran ts, in c a sh or in kind, from dom estic or foreign so u rces, for purpos(js
21 relevant to th eir functions. In th e case of g ra n ts, in c a sh or in kind, from
22 g o v ern m en ts of foreign c o u n trie s, th e ir agencies a n d in s tru m e n ta litie s a n d
23 in te rn a tio n a l or m u ltila te ra l in s titu tio n s or o rg a n iz a tio n s, accep tan ce
24 thereof sh all be su b je c t to th e prior clearan ce a n d approval by th e P residen t
25 or h is au th o rize d rep re se n ta tiv e b a sed on th e reco m m en d atio n of the
26 S ecretary of F inance.
27
28 The provisions of th is Section sh all not apply to: (1) a n y g ra n t received by
29 LGUs or GOCCs, except w here th e g ra n t is received by th em on b eh alf of the
30 NG; or (2) any g ra n t au th o rize d or covered in acco rd an ce w ith existing law.
31
32 G ra n ts received in kind sh all be valued a n d reg istered in th e pro p er
33 registry of th e N ational G overnm ent.
34
35 S e c tio n 5 0 . T r e a s u r y S in g le A c c o u n t. - The TSA refers to th e b an k in g
36 a rra n g e m e n t m an ag ed by the BTr w herein th e governm ent tra n s a c ts all
37 m onies collected, received or paid by NGAs in one b a n k a c c o u n t or a se t of
38 linked b a n k a c c o u n ts a n d gets a consolidated view of its c a sh position on a t
39 least, a daily b asis.
40
41 The TSA sh all cover re m itta n c e s, releases or d isb u rse m e n ts from the
42 G eneral F u n d , SAGFs, Special F u n d s, a n d any o th e r fu n d m an ag ed by the
43 BTr, except in a n y of th e following in stan c es:
44

24
 1 (a) W hen m onies u n d e r th e G eneral F u n d are placed u n d e r in v estm en ts;
2
3 (b) W hen th e BTr is req u ired to hold foreign c u rre n cy a c c o u n ts; or
4
5 (c) W hen a u th o rize d by th e S ecretary of Finance.
6
7 The BTr, in co o rd in atio n w ith NGAs a u th o rized by law to u n d e rta k e
8 revenue collection a n d a d m in istra tio n , sh all m ake th e n e cessary
9 a rra n g e m e n ts w ith au th o rize d ag en t b a n k s (AABs) to facilitate th e collection
10 a n d tra n sfe r of said rev en u es to th e TSA. AABs sh all d ep o sit said collections
11 to TSA w ithin th e period a n d in the m a n n e r p rescrib ed by law s, ru les a n d
12 regulations.
13
14 S e c tio n 5 1 . O v e rs ig h t o n G o v e rn m e n t B a n k A c c o u n ts. -N o tw ith stan d in g
15 any provision of law to th e co n trary , the BTr shall u n d e rta k e an y of the
16 following in case of violation of a provision in th is Act a n d guidelines issu e d
17 on the im p lem en tatio n of th e TSA:
18
19 (a) T ran sfer b a la n c e s of NGA b a n k a c c o u n ts to th e TSA;
20
21 (b) Close a n y NGA b a n k acco u n t; a n d /o r
22
23 (c) Revoke th e a u th o rity to open an y NGA b a n k acc o u n t.
24
25 The NGA or GOCC w hich h a s opened a b a n k a c c o u n t, a s well a s th e
26 b a n k concerned sh all prom ptly disclose inform ation reg ard in g su c h
27 a cc o u n t to the BTr.
28
29 S e c tio n 5 2 . T r e a s u r y C a s h M a n a g e m e n t. - The BTr sh all issu e o rd ers for
30 the c o n d u ct of c a sh m an a g em en t including th e re q u ire m e n t to provide
31 projections on th e tim ing of fu tu re tra n s a c tio n s of NGAs tak in g into
32 co n sid eration th a t th e a p p ro p ria tio n s law is co n sid ered th e a u th o rity of the
33 agencies to c o n tra c t o u t a n d d isb u rse fu n d s, except for in sta n c e s provided
34 in the IRR.
35
36 S e c tio n 5 3 . In v e s tm e n ts . - The BTr m ay invest p o rtio n s of th e fu n d s held
37 in the TSA for su c h periods a s th e BTr m ay deem p ru d e n t consid erin g cash
38 m an ag em en t re q u ire m e n ts a n d b ased on term s a n d co n d itio n s a s m ay be
39 set by th e IRR of th is Act. In v estm e n ts are au th o rize d to be m ade in any of
40 the following:
41
42 (a) D eposit w ith an y highly rep u ta b le b a n k following a selection criteria to
43 be issu e d by th e S ecretary of F inance in c o n su lta tio n w ith the BSP;
44
45 (b) S overeign-issued se cu ritie s w ith a n in v estm en t grade rating; or
46
47 (c) O ther fixed incom e se cu rities w ith a n AAA cred it ra tin g issu e d by at
48 least two (2) re p u ta b le in te rn a tio n a l credit ra tin g agencies acceptable
49 to th e S ecretary of Finance.

25
1
2 The BTr m ay a p p o in t a fund m an a g er a s a n a g en t of th e N ational
3 G overnm ent to u n d e rta k e th e in v estm en t of th e fu n d s.
4
5 In tere st e arn e d a n d o th e r incom e from in v estm en ts sh all a ccru e to the
6 G eneral F u n d , u n le s s otherw ise provided by law.
7
8 S e c tio n 5 4 . M a n a g e m e n t o f N a tio n a l G o v e rn m e n t B o rro w in g s. -
9 Borrowings by th e N ational G overnm ent shall be for an y of th e following
10 p urposes:
11
12 1. F inan cin g b u d g et deficits a n d liquidity shortfalls;
13 2. R efinancing a n d pre-fin an cin g m a tu rin g d eb ts;
14 3. O btain in g foreign c u rre n cy on beh alf of th e BSP;
15 4. O n-lending to a n approved entity;
16 5. F in an cin g all su m s of m oney paid to fulfill g u a ra n te e s;
17 6. R egulating in te rn a l m o n etary cond itio n s sh o u ld th e n ecessity arise;
18 7. Providing financing to rem edy th e effects of n a tu ra l calam ities; or
19 8. D efraying e x p e n d itu re s covered by a p p ro p ria tio n s.
20
21 Borrowing u n d e r th is Act sh o u ld ad h ere to th e Fiscal R esponsibility
22 Principles a n d m e a su ra b le fiscal objectives in the S ta te m e n t of Fiscal Policy.
23
24 S e c tio n 5 5 . B o rro w in g s by G o v e rn m e n t -O w ned o r -C o n tro lle d
25 C o rp o ra tio n s . - Before th e end of each fiscal year, th e H ead of a GOCC
26 shall p rep are a borrow ing program for the following fiscal y e a r w hich shall
27 su p p o rt th e COB a n d for the m edium term , b oth of w hich sh all include a
28 full financial p lan w ith th e details of the loans, refinancing a n d rep ay m en t
29 th a t th e GOCC in te n d s to take. Said borrow ing program , in clu d in g c h an g es
30 thereon, sh all be su b je c t to th e approval of the H ead of th e NGA overseeing
31 the GOCC, a n d sh all be su b m itte d to DOF for inform ation, a n d shall be
32 p u b lish ed in th e co n cern ed GOCC w ebsite.
33
34 GOCCs sh all seek approval of DOF for th e ir borrow ing activities a s
35 defined in th e IRR.
36
37 Nothing in th is Section shall be c o n stru e d a s cre atin g a governm ent
38 g u a ra n tee on an y borrow ing, lo an s or refinancing a n d re p a y m en t th a t the
39 GOCC in te n d s to take.
40
41 S e c tio n 5 6 . L o c a l G o v e rn m e n t B o rro w in g s. - An LGU m ay borrow fu n d s
42 from dom estic a n d foreign so u rc es in acco rd an ce w ith th e Local G overnm ent
43 Code of 1991 or an y o th e r applicable law. The financial p lan includ in g
44 borrow ing program sh all be p u b lish ed in th e a p p ro p ria te governm ent
45 w ebsite w ithin seven (7) days after th e borrow ing pro g ram h a s been
46 approved.
47

26
 1 S e c tio n 5 7 . D eb t R e p o rtin g . - The DOF, th ro u g h th e BTr, sh all e n su re th a t
2 the records include inform ation on th e principal, term s of repaym en t,
3 a m o u n ts draw n, in te re s ts a n d service c h arg es a c c ru e d , principal an d
4 in te re sts paid, a n d th e b alan ce o u tsta n d in g , a n d sh all m ake th e record s
5 available in a tim ely way to th e P resident, C ongress a n d COA w hen
6 req u ested a n d in a cco rd an ce w ith the reporting re q u ire m e n ts in th is Act.
7
8 E ach LGU a n d GOCC sh all m a in tain records a n d provide rep o rts to the
9 DOF on lo an s a s req u ired by relevant law s, ru les a n d reg u latio n s.
10
11 S e c tio n 5 8 . G u a r a n te e s . - G u a ran tee , indem nity or secu rity sh all be
12 provided to a n NGA or a GOCC a s provided by law, a n d su b je ct to the
13 a n n u a l g u a ra n te e ceiling p rescrib ed in th e G eneral A ppropriations Law, a n d
14 u p o n su c h te rm s a n d cond itio n s a s th e S ecretary of F inance m ay
15 recom m end c o n siste n t w ith relevant law s, ru le s a n d reg u latio n s. The overall
16 level of g u a ra n te e , indem nity or secu rity sh all a d h ere to the Fiscal
17 R esponsibility P rinciples laid dow n in th is Act an d th e fiscal objectives in the
18 S ta te m en t of Fiscal Policy.
19
20 The DOF sh all ch arg e a risk -b a se d fee for an y g u a ra n te e , indem nity,
21 security, relending or sim ilar financial accom m odation it m ay extend to a
22 GOCC.
23
24 In no case shall th e N ational G overnm ent be liable for an y borrow ings by
25 any agency of th e governm ent except for explicit g u a ra n te e s a s provided by
26 law.
27
28 S e c tio n 5 9 . L im ita tio n o n th e L ia b ility o f th e N a tio n a l G o v e rn m e n t F o r
29 D eb ts o f O th e r E n titie s . - The N ational G overnm ent sh all n o t be liable for
30 any im plied g u a ra n te e s a sse rte d by any p erso n or entity, b u t only for
31 explicit g u a ra n te e s extended in acco rd an ce w ith existing law s, an d
32 g u a ra n te e s in favor of th e G overnm ent Service In su ra n c e System , Home
33 D evelopm ent M utual F u n d , Philippine H ealth In su ra n c e C orporation, an d
34 the Social S ecurity System in th eir respective c h a rte rs.
35
36 S e c tio n 6 0 . P a y m e n ts M ad e f o r C o n tin g e n t L ia b ilitie s . - Any m oney paid
37 by the DOF p u r s u a n t to an y g u a ra n te e , indem nity, or se cu rity a u th o rized by
38 law an d th e e x p en ses a sso c iated w ith th e sam e sh all c o n stitu te a d eb t d u e
39 the N ational G overnm ent from the entity for w hose benefit th e p ay m en t on
40 the g u a ra n te e , indem nity, or security w as m ade.
41
42 S e c tio n 6 1 . I n f o r m a tio n o n C o n tin g e n t L ia b ilitie s . - The DOF shall keep
43 a com plete a n d u p d a te d registry of all co n tin g en t liabilities of th e N ational
44 G overnm ent, a n d provide th e OCG w ith a rep o rt on c o n tin g en t liabilities a s
45 of the fiscal year.
46
47

27
 1 PART VI
2 ACCOUNTABILITY AND REPORTING
3
4 S e c tio n 6 2 . F i n a n c i a l M a n a g e m e n t a n d I n t e r n a l C o n tro l. - The H ead of
5 Agency shall be resp o n sib le an d acc o u n ta b le for th e financial m an a g em en t
6 of the agency w hich sh all include m eeting perform ance targ e ts, controlling
7 costs, m itigating ad v erse risk s to agency o p e ra tio n s, a n d e n su rin g th a t
8 b u d g ets are m an ag ed w ith integrity a n d in com pliance w ith applicable laws.
9 A dequate in te rn a l co n tro ls sh all be e n su re d a n d a n in te rn a l a u d it function
10 shall be m ain tain ed .
11
12 S e c tio n 6 3 . I n t e g r a t e d F i n a n c i a l M a n a g e m e n t I n f o r m a tio n S y stem . -
13 There shall be a n in teg rated financial m an a g em en t inform ation system ,
14 w hich shall be th e single p ortal of all financial tra n s a c tio n s a n d rep o rts to
15 be u se d by NGAs, GOCCs a n d LGUs to in te g rate budgeting, c a sh
16 m an ag em en t, a cc o u n tin g a n d a u d itin g processes.
17
18 S e c tio n 6 4 . NGA A n n u a l P l a n s a n d P ro p o s e d B u d g e ts . - The H ead of
19 each NGA sh all pro d u ce a n A nnual Plan w hich sh all have a m edium term
20 scope, w ith d e tails for th e following fiscal year, a n d sh all include inform ation
21 on the strategic priorities for th e m ed iu m -term , c o n siste n t w ith the
22 Philippine D evelopm ent Plan; perform ance inform ation; su m m a ry proposed
23 b u dget inclu d in g financial forecasts a s s u m p tio n s a n d highlighting
24 significant cap ital projects; a n d o th er inform ation a s req u ired in th e IRR, a s
25 well a s the B udget Call a n d o th e r related o rd ers from th e DBM. The A nnual
26 Plan shall be su b m itte d to DBM d u rin g the b u d g et p re p a ra tio n p ro cess
27 c o n sisten t w ith the tim etable a n d o th er guidelines in th e B udget Call.
28
29 The A nnual Plan of a D e p artm en t sh all in co rp o rate th e A n n u al P lans of
30 its a tta c h e d NGAs a n d GOCCs su b je ct to guidelines p rescrib ed in th e IRR.
31
32 S e c tio n 6 5 . NGA R e p o rtin g R e q u ire m e n ts . - For g re a te r tra n sp a re n c y
33 and acco untability, each H ead of a n NGA shall:
34
35 (a) S u b m it m on th ly a n d q u a rte rly rep o rts on th e ag en cy ’s financial an d
36 n on-financial perform ance to the DBM a n d OCG, n o t la te r th a n thirty
37 (30) days after th e en d of every m o n th a n d q u a rte r in th e form at
38 specified by th e DBM a n d shall p u b lish th e sam e on a governm ent
39 w ebsite w ithin th e sam e reglem entary period;
40
41 (b) Prepare a n A nnual R eport w hich sh all in clude y e ar-en d financial
42 sta te m e n ts, rep o rtin g on n o n-financial p erform ance com pared a g ain st
43 the A nnual Plan, a n d o th e r inform ation a s req u ired in th e IRR; su b m it
44 the said R eport to th e DBM, OCG, a n d C ongress no la te r th a n six (6)
45 m o n th s after the en d of the fiscal year; a n d p u b lish th e said R eport in
46 a governm ent w ebsite no later th a n seven (7) d ay s afte r its su b m issio n
47 to C ongress.

28
 1
2 The m onthly, q u arterly , a n d a n n u a l rep o rts of a D e p a rtm e n t sh all
3 in co rp o rate th e rep o rts of its a tta c h e d NGAs a n d GOCCs su b je ct to
4 guidelines p rescrib ed in th e IRR.
5
6 S e c tio n 6 6 . S e rv ic e A g re e m e n ts . - The H ead of a n NGA m ay e n te r into a
7 service a n d /o r p erform ance ag reem en t w ith a n o th e r agency for th e la tte r to
8 provide services ch arg ed a g a in st th e b u d g et of said p rin cip al agency.
9
10 S e c tio n 6 7 . C o rp o ra te O p e ra tin g B u d g e t. — The B oard of D irectors or
11 T ru stee s of a GOCC sh all p rep are a n d su b m it a COB to th e H ead of th e NGA
12 overseeing said GOCC, th e DBM, a n d the DOF, n o t later th a n n inety (90)
13 days prior to th e co m m en cem en t of th e fiscal year, w hich sh all include, the
14 objectives of th e GOCCs a n d its su b sid ia rie s, th e activities to be u n d e rta k e n ,
15 perform ance ta rg e ts a n d risk s; fo recasts of financial s ta te m e n ts for th e next
16 th ree (3) years; an d o th e r inform ation a s m ay be req u ired in th e IRR.
17
18 The Head of th e NGA overseeing said GOCC sh all en d o rse th e B oard-
19 approved COB to th e DBM, for th e la tte r’s approval. The H ead of a GOCC
20 shall p u b lish th e D BM -approved COB of th e GOCC on th e official w ebsite of
21 the C orporation n o t la te r th a n fourteen (14) d ay s afte r th e approval of the
22 COB.
23
24 S e c tio n 6 8 . GOCC R e p o rtin g R e q u ire m e n ts . - For g re a te r tra n sp a re n c y
25 an d acco u n tab ility , eac h Head of GOCCs shall:
26
27 (a) Provide q u a rte rly rep o rts on financial a n d n o n -fin an cial perform ance
23 to th e DOF, GCG a n d the DBM, no la ter th a n th irty (30) days after the
29 end of th e q u a rte r, in th e form at a n d tim e specified by th e DOF, GCG
30 a n d DBM a n d sh all p u b lish it on th e ir official w ebsite w ithin th e sam e
31 period; an d
32
33 (b) P repare a n A nnual R eport, w hich shall in clude y e ar-en d financial
34 sta te m e n ts, rep o rtin g on n o n-financial perform ance co m p ared a g ain st
35 th e COB, a n d o th e r inform ation a s required in th e IRR; su b m it the
36 sam e to th e overseeing NGA, DBM, GCG, DOF a n d C ongress no later
37 th a n six (6) m o n th s after the end of th e fiscal year; a n d p u b lish the
38 said R eport in a governm ent w ebsite no later th a n seven (7) d ay s after
39 its su b m issio n to C ongress.
40
41 GOCCs w ith su b sid ia rie s shall reflect in its q u a rte rly a n d a n n u a l rep o rts
42 the aforem entioned req u ired inform ation for th e whole co rp o rate group,
43 c o n sisten t w ith guidelines p rescrib ed in th e IRR.
44

29
 1 S e c tio n 6 9 . S e rv ic e A g re e m e n t f o r a GOCC. - W here GOCCs im plem en t
2 governm ent non-com m ercial p rogram s, su c h a s h o u sin g provision,
3 irrigation a n d electrification, a n d receive g o vernm ent funding, a service
4 ag reem ent w ith the NGA overseeing said GOCC sh all specify th e term s of
5 delivery of goods or services th a t the GOCC m u s t provide, a n d th e fu n d s
6 th a t the g o vernm ent will pay. Program fu n d s shall be u n d e r th e b u d g et of
7 the NGA overseeing said GOCC.
8
9 S e c tio n 7 0 . L o c a l G o v e rn m e n t U nits. - The Local C hief E xecutives (LCEs)
10 shall e n su re th a t a d e q u a te in te rn al co n tro ls a n d a n in te rn a l a u d it function
11 are m ain tain ed .
12
13 The LCEs sh all provide financial a n d n o n -fin an cial perform ance
14 inform ation of th e ir respective LGUs to th e OCG, DILG, a n d th e BLGF u n d e r
15 the DOF, su b je ct to th e guidelines to be issu e d th ereo n .
16
17 S e c tio n 7 1 . A p p lic a tio n o f A c c o u n tin g a n d A u d itin g R e q u ire m e n ts . -
18 Any ex p en d itu re of public m oney, including governm ent a s s e ts or liabilities
19 in cu rred by a n d for th e G overnm ent reg ard less of the so u rce of funding,
20 shall be su b je ct to a cc o u n tin g a n d a u d itin g ru le s a n d reg u latio n s
21 prom ulgated by th e COA.
22
23 S e c tio n 7 2 . A c c o u n tin g S t a n d a r d s . - The OCG sh all specify th e basis,
24 s ta n d a rd s a n d guidelines for a p p ro p ria tio n s rep o rtin g while th e COA shall
25 co n tin u e to se t th e b asis, s ta n d a rd s a n d guidelines for financial acco u n tin g
26 for u se by th e NGAs, GOCCs a n d LGUs.
27
28 The H eads of A gencies sh all e n su re th a t full, a c c u ra te a n d p ro p er records
29 are k ept for th e ir respective agencies on financial m a tte rs a n d for
30 perform ance in th e p ro d u ctio n of goods a n d services.
31
32 The DBM, OCG a n d COA sh all e n su re th a t com plete, a c c u ra te a n d
33 a p p ro p riate reco rd s of th e governm ent are k ep t on b oth financial a n d non-
34 financial perform ances.
35
36

30
 1 S e c tio n 7 3 . G o v e rn m e n t C o n s o lid a te d R e p o rtin g . - The OCG shall
2 su b m it a q u a rte rly rep o rt on the consolidated financial perform ance of the
3 governm ent to th e P resident, w hich in clu d es inform ation show ing
4 perform ance a g a in st th e A ppropriations Law, n o t later th a n sixty (60) days
5 after the end of e ach q u a rte r. T his rep o rt shall be p u b lish ed in a governm ent
6 w ebsite w ithin seven (7) d ay s after th e rep o rt is su b m itte d to th e P resident.
7
8 The OCG sh all p rep a re th e consolidated a n n u a l financial sta te m e n ts, not
9 later th a n six (6) m o n th s after the end of the fiscal year, for su b m issio n to
10 the P resident, C ongress a n d COA.
11
12 S e c tio n 7 4 . I n t e r n a l A u d it S t a n d a r d s . —The OCG, in co o rd in atio n w ith
13 COA, shall specify th e s ta n d a rd s for in te rn al a u d it in the NGAs, GOCCs
14 an d LGUs.
15
16
17 PART VII
18 TRANSPARENCY AND PARTICIPATION
19
20 S e c tio n 7 5 . P e o p le ’s A c c e ss to P u b lic F i n a n c i a l In fo rm a tio n . - Before
21 the s ta rt of each fiscal year, th e DBM shall pro m u lg ate a C a len d ar of
22 D isclosures, a n d shall p u b lish th is on the governm ent w ebsite a n d su c h
23 calen d a r sh all co n ta in the sch ed u le of release of all b u d g e t d o c u m e n ts an d
24 inform ation required by th is Act an d its IRR. The DBM sh all m onitor an d
25 periodically rep o rt to C ongress a n d th e public on th e com pliance of agencies
26 with the C a le n d ar of D isclosures a n d o th e r fiscal tra n s p a re n c y requirem ents
27 u n d e r th is Act a n d its IRR.
28
29 All d o c u m e n ts a n d rep o rts required to be p u b lish ed by th is Act a n d its
30 IRR shall au to m atically be m ade available electronically in a governm ent
31 w ebsite. C u rre n t a n d h isto rical d a ta on governm ent rev en u es, e x p en d itu res,
32 an d borrow ings, shall be m ade available electronically, in open d a ta form at,
33 on a governm ent w ebsite, su b je ct to guidelines in th e IRR.
34
35 S e c tio n 7 6 . T he P e o p le ’s B u d g e t. - The DBM shall, for every fiscal year,
36 p u b lish citizen-friendly su m m a rie s of the following, su b je c t to guidelines
37 a n d o th er specifications in th e IRR;
38
39 (a) The S ta te m e n t of Fiscal Policy in the y e a r of th e P re sid e n t’s election
40 a n d an y u p d a te s th ere a fte r w ithin th irty (30) d ay s from su b m issio n to
41 C ongress;
42
43 (b) The P roposed N ational B udget, to be p u b lish ed in electronic form at
44 w ithin th irty (30) d ay s from su b m issio n to C ongress of the Proposed
45 N ational B udget;
46
47 (c) The G eneral A ppropriatio ns Law, to be p u b lish ed in electronic form at
48 in a g o vernm ent w ebsite w ithin th irty (30) d ay s from its effectivity; an d
49

31
 1 (d) The A n n u al Fiscal R eport, to be p u b lish ed in electronic form at in a
2 governm ent w ebsite w ithin th irty (30) d ay s from su b m issio n i:o
3 C ongress;
4
5 S e c tio n 7 7 . P e o p le ’s P a r t i c i p a t i o n in th e B u d g e t P ro c e s s . - The
6 governm ent shall e sta b lish a n d im plem ent su itab le p articip ato ry b udg et
7 m ech an ism s to facilitate th e open, inclusive, a n d m eaningful engag em en t of
8 citizens th ro u g h o u t th e b u d g et p ro cess—from b u d g et p re p a ratio n , to
9 legislation, to execution, a n d to a cco u n tab ility a n d a u d it. S u c h p articip ato ry
10 m ec h an ism s m ay include c o n su lta tio n s a n d p a rtn e rs h ip s w ith civil society
11 o rg an izations (CSOs), acad em ics a n d ex p erts, a n d o th e r individual a n d
12 organized sta k e h o ld e rs th ro u g h o u t the a n n u a l b u d g et process.
13
14 To aid th e em p o w erm en t of g rassro o ts o rg an izatio n s a n d co m m u n ities in
15 the n atio n al b u d g e t p ro cess, th e DBM, DILG, a n d o th e r relev an t agencies
16 sh all facilitate a p ro cess w herein CSOs, com m unity o rg an izatio n s a n d LGUs
17 can jointly identify local priority poverty red u ctio n a n d developm ent n eed s
18 w hich will serve a s in p u t to th e form ulation of th e Proposed N ational
19 Budget. S u ch p ro ce ss shall co n sid er th e p u rs u it of m eaningful local
20 devolution a n d local acco u n tab ility , a s well a s th e stre n g th e n in g of regional
21 an d local developm ent c o u n c ils’ roles in th e n a tio n al b u d g e t process.
22
23 Policies a n d reg u latio n s for th e e sta b lish m e n t of p articip ato ry budgeting
24 m ech an ism s e sta b lish e d by law s shall be form ulated a n d enforced by:
25
26 (a) The DBM, to g eth er w ith o th e r relev an t agencies of th e executive, w hen
27 it com es to p articip a tio n in b u d g et p re p a ra tio n , execution, and
28 accountability;
29
30 (b) The H ouse of R ep resen tativ es a n d th e S en ate, th ro u g h th e ir relevant
31 com m ittees, w hen it com es to p articip atio n in b u d g e t legislation; an d
32
33 (c) The COA, w hen it com es to p articip atio n in th e c o n d u c t of a u d it.
34
35
36 PART VIII
37 ENFORCEMENT
38
39 S e c tio n 7 8 . S a n c tio n s a n d P e n a ltie s . - W ithout prejudice to the
40 provisions of o th e r law s, th e following sa n c tio n s a n d liabilities in case of
41 failure to com ply w ith th e reporting a n d posting re q u ire m e n ts u n d e r th is
42 Act, shall be im posed:
43
44 (a) The DBM sh all n o t approve any re q u e st for release of allo tm e n ts for
45 item s of a p p ro p ria tio n s covered in th e negative list or m odification in
46 the allo tm en t n o r recom m end th e u se of savings by th e P resid en t u n d l
47 su c h tim e a s the n o n -co m p lian t agency h a s su b m itte d th e re p o r t/s
48 required u n d e r th is Act;
49

32
 1 (b) The COA m ay disallow an y e x p en d itu re ch arg ed a g a in st a u g m e n ta tio n
2 u sin g savings, a n d an y e x p en d itu re d u e to m odification in the
3 allotm ent, w hich w ere m ade w ithin th e period su cceed in g the
4 reporting period w hen th e agency failed to com ply w ith th e reporting
5 re q u ire m e n ts u n d e r th is Act;
6
7 (c) Failure to rep o rt on th e incom e a n d /o r fu n d s reta in e d a t th e end of a
8 reporting period sh all re n d e r all d isb u rse m e n ts a g a in st su c h incom e
9 or fu n d s in s u b s e q u e n t rep o rtin g periods a s void, a n d will re n d e r the
10 responsible official liable u n d e r existing laws; a n d
11
12 (d) The C ongress m ay motu proprio or u p o n th e re q u e st of COA a n d /o r
13 DBM th ro u g h its a p p ro p ria te oversight com m ittee com pel th e h ead of
14 the n o n -co m p lia n t agency, u n d e r p ain of c o n tem p t, to pro d u ce the
15 required r e p o r t/s a n d to explain re a so n s for failure to su b m it a n d
16 disclose said re p o rt/s .
17
18 W ithout prejudice to th e provisions of o th e r laws:
19
20 (a) Every c o n tra c tu a l com m itm ent, e x p en d itu re or p a y m e n t a u th o rized or
21 in cu rred in violation of the provisions of th is Act sh all be void a n d
22 shall re n d e r the public official a n d /o r em ployee a u th o rizin g or m aking
23 su c h p ay m en t a n d every p erso n in collusion w ith said official or
24 em ployee sh all jo intly a n d severally be held liable to th e governm ent
25 for th e full a m o u n t so paid or received. The public official or em ployee
26 who know ingly in c u rs any c o n tra c tu a l c o m m itm en t or a u th o riz e s any
27 e x p en d itu re in violation of th e provisions of th is Act or ta k e s p a rt
28 th erein shall likewise be rem oved or d ism issed from office, after du e
29 notice a n d hearin g , even if no crim inal charge is in stitu te d a g a in st
30 him;
31
32 (b) Any public official or em ployee, holding office or em ploym ent in a
33 c a su a l, tem porary, holdover, p e rm a n e n t or re g u la r capacity, who shall
34 cau se the in clu sio n of fra u d u le n t inform ation in any a cco u n tab ility
35 report, sh all be penalized w ith im p riso n m e n t n o t exceeding five (5)
36 y ears, or a fine n o t exceeding One Million Pesos (P I,0 0 0 ,0 00.00), or
37 both, w ith o u t p rejudice to disallow ances th a t m ay be m ade by COA
38 a g a in st e x p e n d itu re s related to su c h fra u d u le n t inform ation, provided,
39 th a t th is fine is reviewed a n d a d ju ste d periodically to be reasonable;
40
41 (c) A conviction u n d e r th is Act shall carry w ith it civil liability, w hich m ay
42 eith er c o n sist of re stitu tio n for the dam age done or forfeiture in favor
43 of th e governm ent of any u n w a rra n te d benefit derived from th e a c t or
44 a c ts in q u e stio n , or b oth, a t th e discretion of th e c o u rts, in ad dition to
45 possible a d m in istrativ e liability; a n d
46

33
 1 (d) Private ind iv id u als who shall conspire w ith th e erring Public
2 Officials or Em ployees, w h eth er a s co -principals, accom plices or
3 accesso ries, in th e com m ission of any violation of th is Act shall be
4 su b je ct to th e sam e p en alties a s th e Public Officials or Em ployees
5 an d shall be tried jointly w ith them .
6
7 S e c tio n 7 9 . J u r i s d i c ti o n . - A ctions u n d e r th is Act sh all be cognizable by
8 the c o u rts, trib u n a ls , bodies, agencies or a u th o ritie s w ith a p p ro p ria te
9 ju risd ic tio n u n d e r existing laws.
10
11
12 PART IX
13 FINAL PROVISIONS
14
15 S e c tio n 8 0 . Im p le m e n tin g R u le s a n d R e g u la tio n s . - The DBM in
16 co n su lta tio n w ith the DOF, BTr, NEDA an d COA, a n d in coordination with
17 agencies co n cern ed , shall issu e the IRR n e ce ssa ry for the proper
18 im plem entation of th is Act, w ithin ninety (90) days from th e effectivity of th is
19 Act. The IRR m ay be am en d ed by the DBM, in co o rd in atio n w ith the
20 agencies co n cern ed , a s th e need arises.
21
22 S e c tio n 8 1 . T r a n s ito r y P ro v isio n s . - The DBM, DOF, BTr, NEDA a n d COA
23 shall p ro duce a n d su b m it w ithin th irty (30) d ay s from p rom ulgation of the
24 IRR, a T ran sito ry Plan for inform ation, to th e J o in t C ongressional O versight
25 C om m ittee on Public E x p en d itu re s to e n su re th e p ro p er im p lem en tatio n of
26 the provisions of th is Act, p resen tin g the S ections th a t will not be
27 im plem ented on th e p a ssin g of th is Act a n d those req u irin g com pliance with
28 certain co n d itio n s or th e h a p p en in g of events before th e provisions herein
29 m ay be im plem ented.
30
31 S e c tio n 8 2 . R e p e a lin g C la u s e . - Any law, p resid en tia l decree or issu a n c e,
32 executive order, letter of in stru c tio n , ad m in istrativ e order, proclam ation,
33 c h arter, rule or regulation a n d /o r p a rts th ereo f c o n tra ry to or in co n siste n t
34 with the provisions of th is Act is hereby repealed, m odified or am ended
35 accordingly.
36
37 S e c tio n S 3 .S e p a r a b i li t y C la u s e . - If for any reaso n , an y section or
38 provision of th is Act is declared u n c o n stitu tio n a l or invalid, o th e r sectio n s or
39 provisions w hich a re n o t affected th ereb y shall c o n tin u e to be in full force
40 an d effect.
41
42 S e c tio n 84. E ffe c tiv ity C la u se . - T his Act shall take effect fifteen (15) days
43* following its p u b licatio n in the Official G azette or in two (2) n e w sp ap ers of
44 general circulation.
45
46
47 A p p ro v ed ,

34