Iloilo 2019 budget ruckus

The Beekeeper

By Pet Melliza

Are lump sums allowed in annual budgets of local government units (LGU)? This question is now subject of contention between the legislative and executive branches of government of Iloilo Province.

Governor Arthur D. Defensor, Sr. insists that is legal as he integrated lump sums in his proposed 2019 annual budget which now hangs because majority at the sangguniang panlalawigan (SP) want them itemized first.

I don’t want to dip my hands in the fray. But being one of the 2,000 or so provincial employees whose fourth and last tranche of salary increase under the Salary Standardization Law (SSL) effective January 2019 is in limbo, this is no longer funny especially the insistence of the majority to “itemize” all those pesky lump sums as sine qua non.

Back to the question: are lump sum allowed in LGU annual budgeting. I dare answer: “YES”.

The law not only makes that automatic but also mandatory of LGUs to appropriate out of their annual budgets whether itemized or not, at least 20% for “development projects” (Sec. 287, RA 7160 or the Local Government Code); 5% for disaster risk reduction and management (DRRM; Sec. 21, Republic Act 10121 or the National Disaster Risk Reduction and Management Act); 5% for gender and development (GAD; Sec. 36 of RA 9710 or the Magna Charta for Women); and all collection from the 1% additional tax on real property which automatically goes to the special education fund (SEF) for disbursement by the local school board (Sec. 272, RA 7160).

What are the mechanisms to ensure correct disbursement of these lump sums? The law provides. In case of the 20% development fund, Sections 106 and 107 of RA 7160 mandates the formation of local development councils (LDCs), for Iloilo, the provincial development council (PDC). The PDC maps out projects for accomplishment in a given period. The PDC comprises the governor as head and as members, all mayors, all representatives of Iloilo’s five congressional districts of the Lower House, NGOs and SP members.

The PDC approves projects proposed by members that the governor transmits to the SP for approval. The inventory of projects is not as detailed as the program-of-works of individual undertakings, but just the same, the lump sum is given the specifications later before implementation.

The PDC convenes at least once a year but I am not sure whether members of the Lower House in five congressional districts of Iloilo Province attend it. If Gov. Arthur Defensor proposed an annual budget of say, P3B, 20% of that which is P600M, is mandated for development projects like road construction and repair (Iloilo has 300+km. of provincial roads to maintain) and 12 district hospitals aside from its fleet of 50 or so heavy equipment.

Here is an instance where a sum lumped under a specific purpose may be charged to defray a

specific project as the fiscal year progresses. November 8, 2011, Super-typhoon Yolanda devastated central and northern Iloilo: over 30,000 homes were destroyed, 200+ lives lost, and 50,000 persons dislocated. Defensor ordered the immediate release of the contingency, 5% of the DRRM fund to rush relief and rescue operations.

He convened the provincial DRRM council (PDRRMC) which recommended placing the province in a state-of-calamity that the SP lost no time to approve. The SP granted the release of the DRRM fund which is 5% of the annual budget, to repair roads and bridges, and procure more relief supplies.

Had Defensor pre-itemized the disaster funds, he had virtually left himself no elbow room to maneuver in the midst of the calamity. The SEF fund, all collection from the 1% additional tax on real property, has been traditionally approved in lump sum and disbursed as the need arises within the fiscal year through the provincial school board (PSC).

Co-chaired by the governor and the DepEd division superintendent, the board meets to lay down plans which, once approved, are transmitted to the SP for approval. The SP authorizes the governor to charge the project to the SEF (like but not limited to DepEd sponsored sports events) and the latter authorizes him to release the amount to the DepEd with corresponding signing of contract of grant.

Same goes with the GAD funds, through the provincial council for the protection of women (PCPW), which convenes to propose plans like construction of “crisis centers” for battered women and children. The governor transmits its proposal to the SP and the latter authorizes him to disburse the amount charged to the GAD for the center. Both the executive and legislative department of Iloilo Province have representations in the women’s council.

There’s the rub though: the law allows lump sums in annual local budgeting but is silent on the limit of the “power of the purse” wielded by the SP. The local legislature can simply sit on it—and it’s completely legal—and demand the lame excuse that all lump sums be first itemized.

However, there’s yet another rub: as the majority local legislators drag their feet, they could invite political backlash that might reach their backer who’s gunning for the highest seat in Iloilo Province, and already identifed as you-know-who. (30)