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The Role of Legislation in National Development: Significant Policies & Policy Reforms Aimed at Poverty Reduction

Director Novel V. BangsalCongressional Policy and Budget Research DepartmentHouse of Representatives

Development Discussion on Localizing Poverty Reduction TargetsSi l l iman University, Dumaguete CityJune 9, 2015

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Functions of the legislature Representative - represent the will of the people, the

legitimate source of authority in democratic countries Legislative - amend, approve or reject government bills or

introduce legislation on their own; includes the “the power of the purse”

Oversight - oversee the preparation of a given policy (ex ante oversight) and/or the execution and implementation of a given policy (ex post oversight)

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Parliament & the PRS Policy Process

Source: WBI 2008

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Perceptions of Congress

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Parliamentary engagement in practice

The people do not easily recognize the beneficial effects of laws on their lives.

The people value more the representation and oversight functions of Congress more than legislation.

People look up to the legislators to facilitate their access to government services that directly impact on their lives.

People consider legislators as acting on their behalf when they investigate and demand accountability on the use of government funds.

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Legislative Priorities of the 16th Congress

The legislative agenda of Congress should resonate with the needs of the time.

Must be able to package and present legislative priorities in relation to the Philippines’ socio-economic situation.

Given the limited time, should Congress focus on a shorter list of priority bills?

Which bills should be given priority attention and get enacted in 2015?

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Rate of Poverty Reduction by Administration, 1985-2014

Monsod, Inquirer, June 6, 2015

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Status of Legislative Measures of PDP 2011-2016

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The budget cycleCongress often restricts its role

in the overall budget cycle.

Spending/revenue approval stage often hurried, very internalized within Congress

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NEP Priorities, 2015

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NEP Priorities, 2015

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NEP Priorities, 2015

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Improving budget oversight Congress need to relate to the budget cycle

process at earlier stages of analysis (budget prep), enforce accountability on financial reporting, on evaluation of programs (budget implementation), on policy implementation, and on timely follow-up of financial abuses uncovered by audit.

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No. of findings

Amount (in mil)

1. Unauthorized/irregular/unncessary expenses 1,642 18,653,5162. Unliquidated cah advances 1,003 7,534,1533. No bidding/not in accordance with Procurement law 692 15,163,3534. Underassessment/undercollection 157 20,813,2245. Unutilized/ineffective projects 104 13,583,5336. Lack of appropriation 100 525,3637. Unliquidated fund transfer 77 6,800,3138. Delayed remittance premiums of employees 73 750,9109. Non-existence cash/unaccounted assets 49 1,199,75310. Unimplemented projects/unulitized funds 47 3,276,23511. Shortages and malversion of funds 42 282,32712. Delayed implementation of projects 36 2,554,05613. Unremitted/uncollected income receivables 34 3,511,81014. Overpricing/excessive contract cost 34 1,117,41915. Unsettled suspensions/disallowances/charges 32 203,75016. Fictitious claims/expenses 26 5,198,77217. Untitled land purchased/owned 17 390,67118. Undeposited collections 9 149,65819. Unrecouped advances/mobilization 6 107,860

TOTAL 101,816,676

ParticularTotal

Common Audit Findings with Pecuniary Loss, 2011

COA, 2011

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However, it is the executive and not Congress that, by law and practice, actually wields effective power over the purse (PHDR 2008/2009).

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Diminishing power of the purseThe Executive can override the mandate of the GAA: By not releasing or by delaying the release of authorized

appropriations; By transferring “unused” (unreleased) appropriations to “savings”

and using this amount for other purposes within the executive branch;

Through the use of discretionary, intelligence, or confidential funds—over which the legislature has no oversight—as well as “unprogrammed” funds in the budget (PIDS 2009).

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Weak congressional oversight (1)The Philippine Human Development Report 2008/2009 notes that: Congress fails to adequately validate the performance of agencies

or the consistency of budgets with state policy Cost estimates of budget proposals are rarely challenged COA audit findings are largely ignored Weak congressional oversight, combined with inherently powerful

spending powers of the executive, has unfortunately invited corruption

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Weak congressional oversight (2)Other observations: Congress has no systematic way of conducting budget

oversight While COA regularly submits reports to Congress, submissions

are usually not timely for the conduct of oversight The use of said reports is not maximized due to a host of

factors, e.g. reports are technical, lack of capacity among legislative staff and committees to undertake scrutiny of public accounts

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Critical Success Factors Political will and commitment to the process of budget

oversight; Impartiality of the budget oversight committee; The timeliness of financial statements and audit reports on

them; Strengthened links between CoA and Congress; greater

emphasis on performance audits; Involvement of CSOs in the budget oversight process; Capacity building for all stakeholders in the process.

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MARAMING SALAMAT!