DBM wants unprogrammed funds in 2024 budget cut to 5%

The Department of Budget and Management (DBM) is eyeing to reduce the share of unprogrammed appropriations in the national budget next year, taking into consideration the government’s fiscal space.

At the Kapihan sa Manila Bay forum on Wednesday, Budget Secretary Amenah Pangandaman said the ideal percentage of unprogrammed funds “should only be 5% of the total budget.”

During last year’s deliberations for the 2023 budget, it was revealed that the share of unprogrammed fund to the overall budget is 11.2% amounting to P588.16 billion, bulk or P378.2 billion of which were loan proceeds requirements of the Department of Transportation. 

The DBM had defended the more than half-a-trillion pesos of unprogrammed funds, saying that if the loan proceeds requirements of the DOTr will be removed the standby appropriations will only be 4% of the total budget.

Compared to programmed appropriations which have definite/identified funding at the time the budget is prepared, the DBM said unprogrammed appropriations are those "which provide standby authority to incur additional agency obligations for priority programs or projects when revenue collection exceed targets, and when additional grants or foreign funds are generated."

For next year’s P5.768-trillion budget, Pangandaman said the government hopes to adhere with the ideal 5% share of unprogrammed funds to the overall expenditure program.

“Hopefully, if we have a tight fiscal space now, sana po kaya naming mag-adhere to that 5% lang unprogrammed appropriations that we can put in the budget for 2024,” the Budget chief said.

The Budget chief explained that a higher unprogrammed fund will be more difficult to sustain as its release is dependent on excess revenues to be generated by the government.

“Kasi po ang unprogrammed, you can only trigger its release if there are additional revenues na darating. Paano kung wala? So sayang lang na nandoon siya. Ideally, it’s a standby fund eh... when you project your revenue talagang minsan merong additional revenue pero kung sosobra sa 10% it will be quite difficult to sustain that,” Pangandaman said.—LDF, GMA Integrated News