DBM ready to release P28-B ‘pork’ for LGUs

By Riza Lozada 

Aside from the automatically appropriated Internal Revenue Allotments (IRA), a total of P28 billion in lump sums, or what used to be commonly referred to as the pork barrel fund, is set to be released to local government units (LGUs), just nine months before next year’s elections. 

The Department of Budget and Management (DBM) issued the guidelines for the “special allotments” to LGUs only in June or just two months, ago, although the amount has been earmarked in the 2015 budget.

The DBM said the deferment in the lump sums’ release was caused by some delays in the formulation of the implementing rules. But observers noted the proximity of the release date to the start of the campaign period for next year’s polls.

The DBM is now requiring LGUs to submit documents as basis for the extent of each LGU’s share in the P28-billion lump sums to be raised mainly from tax collections and should all be used up in the current year.

The amount is said to represents the special share of LGUs in the collection of taxes, including value-added taxes, sin taxes, and other community-sponsored development schemes such as economic zones. The fund is contained in the New Appropriation of the General Appropriation Act of 2015.

President Aquino, in his veto message for the 2015 budget, directed Budget Secretary Florencio Abad to issue guidelines that would dispel any doubt that the special shares of LGUs in the national wealth taxes would contravene any existing laws pertaining to lump sums or pork-barrel allocations.

But Abad issued the guidelines only this June, advising LGUs “to coordinate with the appropriate revenue-collecting agencies and government corporations to reconcile their records with those of collecting agencies to determine the amount of their shares from the abovementioned taxes.”

Aside from local taxes, collections from taxes due from exploitation of natural resources within the jurisdiction or territory of LGUs form part of their P28-billion special shares.

In the proposed 2016 budget, the special share of LGUs is pegged at P36 billion.

This month, Abad also released another guideline pertaining to the Local Government Support Fund (LGSF) with a new appropriation of P3.1 billion. Of this, P2.8 billion would be for the funding of projects under the bottom-up-budgeting (BUB) scheme.

The LGSF is a budget component under the Allocation For Local Government Units (Algu), which also includes special shares of LGUs in national taxes.

Projects under the BUB, which has been renamed grassroots participatory budgeting (GPB), are mostly priority poverty-reduction items listed in the 2015 budget, with the DBM advising LGUs to refer to an earlier joint memorandum on allocation and disbursement of the fund.

The joint memorandum, issued in February, enjoined the departments of Budget, Local Government, Social Welfare and the National Anti-Poverty Commission to implement the policies on GPB projects.

Also incorporated in the LGSF is P200 million for various programs and projects of LGUs and P100-million financial assistance for the deficiencies in the computation of internal-revenue allotment.

With the guidelines issued by Abad, the remaining veto messages of Mr. Aquino are still being closely watched by civic organizations and budget watchdogs to block efforts to revive the pork barrel in the budget.

In his veto message for the 2015 national budget, the President also directed the DBM to craft new guidelines on the LGU shares in the proceeds of national taxes as a way of avoiding running in conflict with the Supreme Court (SC) decision disallowing Palace acts that created the Disbursement Acceleration Program (DAP).