DBM tells underspending agencies to submit catch-up plans

The Department of Budget and Management (DBM) has ordered state agencies and offices with low budget utilization rates to submit catch-up spending plans and provide details on the challenges causing their low utilization performance.

“We just started providing letters to all the agencies,” Budget Secretary Amenah Pangandaman said at the Kapihan sa Manila Bay news forum on Wednesday.

The DBM issued on June 28, the Circular Letter No. 2024-12, which required all agencies to submit their utilization report as of June 30 this year.

The circular also ordered agencies with low utilization rates, below 50% of their targets, to submit detailed catch-up plans and “identify specific implementation issues/challenges encountered (e.g. procurement delays, regulatory bottlenecks, staffing shortages, among others) causing low utilization/performance rates.”

“We indicate [in the letter] the programs and projects with low utilization and we remind them to already start procurement,” Pangandaman said.

Data from the DBM showed the following are the 10 lowest spenders, in terms of obligation rates:

• Congress of the Philippines - 8.8%
• Commission on Higher Education - 19.2%
• Department of Migrant Workers - 22.1%
• Department of Human Settlements and Urban Development - 24%
• Department of Energy - 33.8%
• Philippine Sports Commission - 35.2%
• Office of the President - 37.2%
• Department of Labor and Employment - 37.8%
• Office of the Vice President - 39.9%
• Department of Justice - 41.4%

The Budget chief said the common reason for the low budget utilization of agencies was the procurement process.

“Hopefully with the New Procurement Act, mas mapabilis pa ang pag-procure (the procurement will be fast tracked),” Pangandaman said.

Last month, President Ferdinand Marcos Jr. signed into law the Republic Act 12009 or the New Government Procurement Act (NGPA).

The NGPA seeks to promote greater transparency, competitiveness, efficiency, professionalism, accountability, and sustainability in the government procurement process.

The law is seen to address existing loopholes in the current government procurement system by clamping down on illegal practices to eliminate opportunities for corruption, thereby preventing wastage in public transactions and resulting in delivery of better services.

The measure is also expected to speed up procurement activities since the period of action is shortened from 90 days to 60 days—from the opening of bids to the awarding of contracts. —VAL, GMA Integrated News