National expenditures Program -NEP

Cash based budget system

-to finish backlogs of overdue projects implemented as far back as of 2015

Education received the lion's share of funds in the proposed 2019 National Expenditure
Program. What does the proposed shift to a cash-based budget system look like for the
Department of Education?

Sofia Tomacruz
Published 6:11 PM, August 27, 2018
Updated 6:32 PM, August 27, 2018

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MANILA, Philippines – Often cited by lawmakers as one of the agencies with supposed
“deep cuts” in the proposed 2019 National Expenditure Program (NEP), the Department
of Education (DepEd) said it would take on as a “game changer” the government’s first
cash-based budget to finish backlogs of overdue projects implemented as far back as
2015.

DepEd Undersecretary Annalyn Sevilla said the department will also prioritize
completing preparations needed for future projects to ensure that they ready to be
implemented and can be included in the agency’s proposed budgets moving forward.

For 2019, the DepEd was allocated P527.714 billion or 72.1% of its P732.28 billion
proposed budget. The 2019 allocation is 8.92% lower than its 2018 budget of P579.419
billion but Sevilla said this decline was to be expected with the shift to a cash-based
budgeting system.

“That is the reality of limited negotiations and the reality of wanting to do more. At the
end of the day we go back to the 3 constraints of budget: money, people, and time. If
we push for our wishful list, it (the burden) will go back to us,” she said in Filipino during
an earlier press briefing.

“The (DepEd) secretary (Leonor Briones) is saying okay na ‘yan, satisfied na kami
diyan (that is okay, we are satisfied with that.) We need to finish all the overdue,” she
added.

With the proposed 2019 NEP as the government’s first cash-based budget, agencies
are mandated to spend their allocated funds and deliver projects within the year. If a
government agency cannot guarantee completion of a project, it will be removed from
its proposed budget. (READ: What is cash-based budgeting?)

“Now we’re changing the game, the budget is good for 2019 only. If we will not deliver
then we will not pay you,” Sevilla said.

That may sound like the way things are supposed to be done but for many years now,
agencies’ budgets have followed two-year, obligation-based budgeting. This means that
payments are disbursed as obligations or commitments that may not necessarily be
delivered within the same year. (Budget deadlock: Who's to blame?)

What does the proposed shift in budget system look like for the education department?
Here are programs that take the biggest hits:

Among the programs with lower budgets, student journalists take the biggest hit as
funds for the development and promotion of campus journalism decreased by 77.6%
from P9.6 million in 2018 to P2.1 million in the 2019 NEP.

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Indigenous peoples education also received a decrease in budget, with allocated funds
56.2% lower from P130 million in 2018 to P57 million in 2019, national assessment for
basic education at 51.3% lower from P485 million to P236 million, and the department’s
computerization program at 50.6% lower from P8 billion in 2018 to P4 billion in 2019.
LESS FUNDS. The DepEd says less funds for its basic education facilities program will translate to the
construction of fewer classrooms and less school seat sets among others. Photo by Darren
Langit/Rappler

Decreased fund allocations for basic education facilities was also 67.1% lower from
P105 billion in 2018 to P34 billion in 2019. This means some proposals under this
program were not fully considered in the agency’s 2019 budget proposal such as the
construction of classrooms and laboratories or workshops, eletrification of schools,
provision of school seats, and premlimenary engineering for planned projects.

Sevilla explained the lower allocation of for construction of classrooms would translate
to about 4,089 new classrooms as opposed to 46,415 new classrooms, 43,200 sets of
school seats as opposed to 80,000 sets, and 1,320 laboratories instead of 3,827.

Less schools will also be included in its electrification program in 2019 with 1,710 sites
up for electrification instead of 5,940 sites.

Meanwhile the school-based feeding program will reach over 1 million learners instead
of the proposed over 2 million learners.

The Department of Budget and Management generally recommends funds based on an

agency's absorptive capacity while funds are usually reduced due to underspending.
Apart from this, the DepEd previously said additional and dedicated funds for its special
education (SPED) programs were rejected. However, the request for more funds was
only supplementary to the existing inclusive SPED program, which is ongoing and will
continue.

On the other hand, the following programs were given higher allocations in the
proposed 2019 budget:

Of the programs with additional funds, voucher programs for public schools not under
the DepEd increased the most by 106.4% from P742 million to P1.5 billion. Voucher
programs help cover the cost of education.

Aside from this, the budget for the repair of school buildings also saw an increase of
54.4% from P6.8 billion in 2018 to P10.5 billion in 2019.

'Big change'

For the agency with the one of biggest shares of funds in the proposed 2019 NEP,
challenges are anticipated in implementing the cash-based budge. Sevilla said the
department is gearing up for the “big change” that will require faster procurement,
delivery, inspection, and payment for projects.

“In the meantime that we shift to cash-based, we will have to catch up with the ongoing
program and project implementation and gear-up for the the one-year validity of
funding,” she told Rappler.

“We see this as an opportunity to become more efficient, effective, and economical in
the delivery of basic education services,” she added.

As more students are placed under the DepEd's watch with each new school year, how
the department will balance the adjustment of shifting to a new budget system with the
delivery of basic services remains to be seen.

The DepEd is scheduled to defend its budget at the House of Representatives on

Tuesday, August 28. – Rappler.com

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Filed under:2019 national budgetcash based budgeting systemnational budget PhilippinesDepartment of
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PHILIPPINES

Private schools group

decries budget cut in
DepEd’s voucher program
The Coordinating Council of Private Educational Associations says subsidy cuts could
lead to a 'massive migration of students and teachers from the private schools to the
public schools' past its capacity

Janella Paris
Published 7:55 PM, September 18, 2019
Updated 7:57 PM, September 18, 2019

NO TO BUDGET CUTS. The Coordinating Council of Private Educational Associations of the Philippines
says cuts in subsidies would result in migration of students from private to public schools. Rappler file
photo
MANILA, Philippines – A group of private schools is urging lawmakers to prevent budget
cuts in the government’s senior high school voucher program, which may affect over a
million students in as many as 4,000 private senior high schools all over the country.

The Department of Education (DepEd) originally proposed P52 billion for its
Government Assistance and Subsidies (GAS) program in 2020, but the Department of
Budget and Management (DBM) approved only P31.18 billion. This is lower than the
P32.12 billion allotted for the program in the 2019 budget.

The Educational Service Contracting (ESC) Scheme and the Senior High School (SHS)
Voucher Program, which private education institutions benefit from, fall under GAS
subsidies. These programs assist private school students with tuition fees and teachers
with salaries.

The Coordinating Council of Private Educational Associations (Cocopea), in a statement

released Tuesday, September 17, said an unintended consequence of the reduced
budget was the possible “massive migration of students and teachers from the private
schools to the public school system beyond its absorptive capacity.”

Education Undersecretary Annalyn Sevilla said during a September 12 budget

hearing in the Senate that the number of students benefitting from the subsidies could
go down to 766,995 next year from 1,225,688 this year.

Sevilla said they are working with the DBM to ensure enough funding for the program.

“Education is perhaps the most important function of the State,” Cocopea said. The
group “believes that education is a public good, regardless whether this duty is realized
through the public school system or through the certified private schools.”

The group also said supporting the DepEd’s partnerships with private schools is
“grounded on the principle of public-private partnership and on the Constitutional
principle of complementarity.”

'Not for profit'

Cocopea also refuted a teachers’ group’s claim that government subsidies are for
private schools’ profit.

The Alliance of Concerned Teachers (ACT) had said that the subsidies had been
“eating up the education coffers as private schools get profits and accumulate assets
while we [public school teachers] are left with nothing every start of the school year.”
To this, Cocopea said private school teachers also get a salary subsidy from the DepEd
programs, “and hence would likewise be affected if the ESC scheme is discontinued.”

The group said ensuring funds for the subsidies “would give [private school students]
more access to quality education with the freedom to choose their schools from among
the public and accredited private schools in the country.” – Rappler.com

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