PUBLIC FINANCE

Pagunsan
Eor
Taba
Rios
Medul

DEFINITION OF PUBLIC
FINANCE:

Deals with the question how the Government

raises its resources to meet its ever-rising
expenditure.

SCOPE OF PUBLIC FINANCE:

According to Musgrave, the scope of public

finance embraces the following three
functions of the governments budgetary
policy confined to the fiscal department:
(i) The Allocation Branch,
(ii) The Distribution Branch, and
(iii) The Stabilization Branch.

SIGNIFICANCE OF PUBLIC
FINANCE:

Taxation
Protection of Infant Industries
Provision Public Goods
Side effects of a Market Economy
Redistribute of Income
Equity
Subsidies and grants
Optimum utilization of resources
Economic Planning
Providing employment opportunities
Market failures

ISSUES AND PROBLEMS:

Limited external sources of public

financing
Tax incentives
Inefficient tax administration
Regressive taxation
Limited external sources of public
financing
Tax incentives
Inefficient tax administration
Regressive taxation

PHILIPPINES POLICY ON PUBLIC

FINANCE:

Public finance policy covers the fiscal

deficit, public expenditure and taxation.
Public Financial Management (PFM) Reform
Programs aim to improve efficiency
accountability and transparency in public
fund use in order to ensure the direct,
immediate, substantial and economical
delivery of public services especially to the
poor.

The FORMULATION OF FISCAL POLICY

lies at the dead center of the democratic
government.
-E. Pendleton Herring, 1938

FISCAL POLICY:

Fiscal policy refers to policies on taxation, and other revenue,

expenditure, and borrowings which is intended to promote the
stabilization and development of the economy.
Now a days, FISCAL AND MONETARY POLICY is used as a single
concept though it has a different aspect of economic policy but
have related impact.
Fiscal and monetary policy have been crafted in response to
requirements of stabilization, and subsequently, and in
accordance with the structural adjustment programs (SAPs)
negotiated by the International Monetary Fund (IMF).
On the other hand, monetary policy is generally understood to
be that which influences the level of money supply in the
economy.
The formulation of fiscal and monetary policy made a huge part
of economic and social development but not limited to sociocultural and political.

WHAT IS PFMP?

The PhilippinesAustraliaPublic Financial Management

Program(PFMP)is a long term partnership between the
Governments of Australia and the Philippines to improve
the efficiency, accountability and transparency of public
fund use in the Philippines.
The Australian Government has committed A$ 30 million to
the program for a period of five years, from its
commencement in October 2011 up to 2016.
The PFMP is assisting the Philippines Government to
implement its Philippine PFM Reform Roadmap: Towards
Improved Accountability and Transparency, 2011
2015.This comprehensive PFM reform agenda aims to
clarify, simplify, improve and harmonize the financial
management processes and information systems of the
civil service in the Philippines.