Aquino administration manages to deal with pros and cons of transparency – Abad (Last of 2 parts)

MANILA, Philippines - The World Bank defines good governance to involve, among others, transparency and accountability in the public office. The use of public funds, which is the mandate of the Department of Budget and Management (DBM), is one area where this has been applied by the Aquino administration, keeping true to its anti-corruption mandate.

Budget Secretary Florencio Abad said this has its pros and cons.

On one side, transparency has ushered in popular pressure to the government to act and reform, if needed. On the other however, Abad believes the present administration’s tack in transparency has hurt it by opening the floodgates to criticisms and controversies

“I really think this whole problem of underspending is exaggerated. But you know, part of the reason why people are aware of this, in the first place, is because we expose it. We are transparent about it,” Abad said, cutting his statements with some inserts of laughs and smiles.

He then went on: “A lot of our problems are created because we are transparent.” I was stopped. I thought I needed some clarification: “So do you regret being transparent in the first place?” Abad was quick to interject, “No.”

The Heritage Foundation’s Economic Freedom Index measures “Freedom from Corruption” as one of its gauge. For the past two decades, the Philippines’ performance has fluctuated from a low of 10 over 100 in 1995, a high of 36 in 2001 after the People Power II, only to go down 24-26 range over the next 10 years. In 2015, the country returned to its high of 36 in the measure.

For the budget chief, steady improvements shown by the country in indicators such as this has some price to pay. For one, public’s vigilance also resulted in headaches for the department, particularly in explaining reforms in the budget process. I asked him what has been the hardest part of his job so far, he replied a three-letter word answer: ‘DAP.’

The Disbursement Acceleration Program (DAP) launched in late 2011 and continued through 2012 was declared unconstitutional by the Supreme Court, saying it encroached upon Congress’ power to allocate funds. It involved the re-allocation of unused funds – initially amounting to P72.11 billion but increased to more than P100 billion – to fast-performing programs and projects.

DAP had good intentions, Abad said, and definitely helped the economy rise from 3.7 percent growth in 2011 to 6.8 percent in 2012 and 7.2 percent the year after that. “Unfortunately, some people very smartly and unfairly attached to DAP to PDAF. It was unfair,” he pointed out.

Just months before the DAP decision, the high court also ruled against the constitutionality of the Priority Development Assistance Fund (PDAF), also known as the pork barrel, given to legislators. On Tuesday, it was reported the Supreme Court upheld its decision after the government’s motion for reconsideration. For Abad, DAP may have been the hardest controversy his agency faced during his tenure, although he had no regrets.

“You know in the government, nothing’s easy. You have to be on your toes everyday. As for me, from day one, I’ve been hit by all sorts,” he said, pausing before completing his answers.

“But if Roxas and Robredo win, I’m willing to serve government again,” he added.

The positive side

Observers have criticized the current government for slow-moving projects which they said came at the expense of transparency and accountability efforts. One good example is the centerpiece economic program, public-private partnership (PPP). When the initiative was launched in 2010, 10 PPP projects were promised to be bid out before the end of that year. It took five years for that to happen.

During the time, economic managers have put the blame on the need for government reform and the time it takes to do so.

While PPP projects have since been on the upswing, spending problems persisted. The government, for its part, has unveiled numerous reforms to address its so-called spending bottlenecks: from shifting all infrastructure funds to the Department of Public Works and Highways, shortening the validity of allocations to a year from original two years, to even using the budget document itself as a “release” document, thereby reducing paperwork in obligating funds during the entire year.

Even President Aquino got involved. The issuance of Administrative Order 46 that established key performing and monitoring units in agencies to fast track spending was said to have contributed to the recent uptick in spending this year. For the budget chief, this is good sign that agencies are learning and responding to public clamor.

“On the other hand, because we are transparent, there is popular pressure and when there’s popular pressure, we get to expose the agencies that are not performing well. This is good because people should know,” the budget chief explained.

While he acknowledged that reforms came with a price of a spending slowdown, Abad said agencies being “overcautious” – especially after the PDAF and DAP rulings – should never be faulted. Instead, he indicated such attitude is necessary, especially when you have a “constantly expanding government.”

“When you’re adopting to change, it’s not going to be fast. For the longest time, people in government wanted control and it’s not easy for them to give up that control because control gives you power,” Abad said.

“But, for instance, when SARO (statement of allotment and release order) was removed, they needed to change and this is the reason why people should get used to it. Suddenly the power was taken away from them,” he pointed out.

In addition, more people are now involved in the budget process, especially with the bottom-up budgeting (BUB) process taking hold. The BUB has allowed state and non-state actors to participate in crafting and monitoring the budget by providing their inputs through the local government units. Abad said making the people more involved is an important part of a growing economy.“You have to make sure that the most basic services are provided to people because when you have an expanding middle class, the demand for good governance grows. Better governance (means) better services,” he said.

On the other hand, agencies should be cut off some slack as well since they are adopting to a new normal where there is fast economic growth. “There are capacity constraints that we need to address because they are growing faster than they have ever been.”

Continuity

Hence, a single term may not be enough. Asking Abad what his plans are after June 2016 may be too early, but he nonetheless has something in mind if ever Liberal Party’s bets Mar Roxas and Leni Robredo win next year’s polls.

“If Roxas and Robredo win, I’m willing to serve government again if they ask me to,” he said without any flinch.

The stalwart admitted more needs to be done even after five years in office, at least in terms of how the state manages its own books. The government is expanding every year, he said, therefore reforms must take new “breadth, depth and magnitude” every year as well.

But in almost six years of pitching the anti-corruption mantra, amid criticisms this undoubtedly put some brakes on government spending, does the public still bite the supposedly clean government Roxas and Robredo are inheriting from Aquino?

To this, Abad replied: “You have to continually emphasize the need for transparency… You cannot underestimate the importance of credibility in governance and credibility means you punish those that steal from the government.”