Palace tells Congress: Cash-based budgeting solves underspending

Trishia Billones, ABS-CBN News

Posted at Aug 13 2018 04:57 PM | Updated as of Aug 13 2018 05:39 PM

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MANILA - A cash-based budgeting will further help curb underspending, a Palace spokesperson said Monday after lawmakers suspended deliberations on next year's budget.

This system is the "panacea for underspending," said Presidential Spokesperson Harry Roque, as he noted that the previous administration resorted to the "fraudulent" disbursement acceleration program in order to hasten spending.

Roque, who was a lawmaker before being appointed to the Cabinet, said the Congress adopted a cash-based system in its approval of the 2018 budget and this bore fruits.

"I think from the results this year, it would seem that the spending capacity has been improved by about 90 percent. Meaning, we’ve solved the problem of underspending with cash-based budget," he told ANC's Headstart.

"I don’t see why Congress all of a sudden does not want it now," he said.

Although Malacañang was surprised by the turn of events, Roque said they are ready for it, adding that a reenacted budget "always suits the executive" because it can substitute the line items which have been done last year.

However, Roque said Budget Secretary Benjamin Diokno cautioned him that a disagreement between Congress and the executive on the budget in the United States leads to the downgrading of credit ratings.

"I would hope that this recent change in leadership in the House will not necessarily translate into a more riotous relationship with the House as far as the budget is concerned," he said.

The House of Representatives suspended deliberations on the 2019 budget until further notice "to be consistent with the position of the House to oppose cash-based budgeting," said Davao City Rep. Karlo Nograles, chairman of the appropriations committee.

"It’s as if the House is saying with new leadership, the Palace better watch out because it won’t be as easy as in the past. I’m not quite sure this is really the message the House wants to send, but you can’t blame Malacañang for perceiving matters as they are in this sense," Roque said.

Roque remains confident, however, that Speaker Gloria Macapagal-Arroyo, an economist, "sees the virtue in cash-based budgeting" and after things "simmer down, we will buckle down to work and pass the budget as scheduled."