DBM denies tighter control over government funds

MANILA, Philippines - Budget and Management Secretary Florencio Abad denied yesterday that his department wanted tighter control over funds, including salaries for government.

He said the Treasury Single Account system will do away with ghost employees.

“Before the salary goes from the treasury to DBM and to the agencies,” he said.

“Within the agency, it would go from the central office to the regions and provincial offices and eventually to the employee. Under (the) National Payroll System, it will be from the Treasury direct to the employees’ individual bank accounts.”

Abad said the new scheme would not mean putting up a single bank account.

“We will be saving precious time, money and temptations from irregularities because nothing will stand between the employees and their salary from the Treasury - not even DBM,” he said.

Abad said agencies would not be able to take hold of the cash so the release of the salaries would be faster and the work of the different departments and agencies lighter.

“The non-remittance of the Government Service Insurance System premiums and the Bureau of Internal Revenue withholding taxes will also be avoided because they will go direct to the GSIS and BIR from the Treasury,” he said.

In his budget message, President Aquino said Treasury Single Account system will provide government with clear visibility on the bank balances of agencies on a daily basis.

It will inject more transparency and predictability in treasury cash management, he added.

It would lead to savings of about P1.5 to P3 billion from interest costs on borrowings, Aquino said.

Presidential spokesman Edwin Lacierda said people should look at the innovations as improving the way funds are spent.

Abad had met with Supreme Court representatives to discuss their concerns on the new budget processes, he added.

Navotas Rep. Toby Tiangco, opposition United Nationalist Alliance secretary-general, said Malacañang’s plan to control the payroll would undermine the principle of checks and balances in government.

Employees would be deprived of their yearend bonuses from savings in their budgets, he added.

Tiangco said Malacañang also inserted provisions that would strip the SC of discretion over the P7-billion Judiciary Development Fund.

The Chief Justice must remit the JDF to the general fund, he added.

By 2014, some 9,500 agency bank accounts will be consolidated into a highly manageable number.

Starting Jan. 1, 2014, Malacañang will put almost P700 billion in salaries of 1.2 million state workers under a centralized payroll system, including coequal and fiscally autonomous branches like the House of Representatives, Senate and Supreme Court.

The system will cover all state workers and employees, including those in local government units and state universities and colleges.

In the last three years, 3,943 House employees had received P50,000 each annually through a “Speaker’s bonus,” and 2,174 Senate employees were given up to P120,000 each by the Senate President at the end of the year.