Philippine Performance-Informed Budgeting System

Presentation for 11th Annual OECD SBOM

December 17, 2015, Bangkok, Thailand

by Republic of the Philippines

Department of Budget and Management

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Pillar 3: Measuring Agency Performance

OPIF

To provide performance information in the budget

process for monitoring, reporting and evaluation of

MFOs accomplishment to guide funding allocations

To link organizational performance with

individual/personnel performance and

promote better performance

management

Two Dimensions

Accountability Framework

Performance Framework

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Significance of OPIF as a Budget Reform

Focus= Outcomes/Outputs

Targets set in indicators

To some extent, performance

information used in allocating

budget

Focus on results

Now with OPIF

Sectoral Goals

Organizational Outcomes

MFOs

P/A/Ps

Societal Goal

Why

What and Who

How

Societal benefits from the sectoral changes

Longer term benefits in the sector from organizational

changes

Concrete short to medium term benefits to clients and

community

Groups of outputs (goods and services) provided to external clients to achieve a common

outcome

Activities or integrated group of activities undertaken to realize

the outputs and outcomes

Logframe: Framework for MFOs & PIs

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II. Shift to A Performance-Informed Budget (PIB) in 2014

Department of Education

A. Office of the Secretary

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STRATEGIC OBJECTIVES

MANDATE

The State shall protect and promote the right of all citizen to quality education at all levels and shall take appropriate steps to make such education accessible to all.

VISION

We dream of Filipinos who passionately love their country and whose values and competencies enable them to realize their full potential and contribute meaningfully to building the nation. As a learner-centered public institution, the DepEd continuously improves itself to better serve its stakeholders.

MISSION

To protect and promote the right of every Filipino to quality, equitable, culture-based and complete basic education where:

1. Students learn in a child-friendly, gender-sensitive, safe and motivating environment

2. Teachers facilitate learning and constantly nurture every learner

3. Administrators and staff, as stewards of the institution, ensure an enabling and

KEY RESULT AREA responsibility for developing life-long learners

Poverty reduction and empowerment of the poor and the vulnerable

SECTOR OUTCOME

Equitable access to adequate quality societal services and assets

supportive environment for effective learning to happen 4. Family, community and other stakeholders are actively engaged and share

ORGANIZATIONAL OUTCOME

Improved access to quality basic education

New Appropriations, by Program/Project

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Current Operating Expenditures

Personnel

Services

Maintenance and

Other Operating

Expenses Capital

Outlays Total

PROGRAM(S)

100000000 General Administration and Support

200000000 Support to Operations

300000000 Operations

MFO 1: Basic Education Policy Services

MFO 2: Basic Education Services

MFO 3: Regulatory and Developmental

Services for Private Schools

Total, Program(s)

TOTAL NEW APPROPRIATIONS

P 6,344,839,000 P 2,123,456,000 P 400,000,000 P 8,868,295,000

2,130,373,000 3,503,969,000 69,500,000 5,703,842,000

185,855,788,000 28,971,602,000 51,324,693,000 266,152,083,000

----------------------- ----------------------- ------------------- ------------------------

76,844,000 248,232,000 325,076,000

185,778,944,000 21,276,300,000 51,324,693,000 258,379,937,000

7,447,070,000 7,447,070,000

----------------------- ----------------------- ------------------- ------------------------

194,331,000,000 34,599,027,000 51,794,193,000 280,724,220,000

----------------------- ----------------------- ------------------- ------------------------

P194,331,000,000 P34,599,027,000 P51,794,193,000 P280,724,220,000

Inter-Agency Task Force on Harmonization of National Government Performance Monitoring, Information and Reporting Systems

(Administrative Order No. 25, s. 2011)

NEDA DOF OP DBM PMS

Government Oversight Partners:

Task Force Members:

GCG CHED

Technical Secretariat:

COA Ombudsman NCC CESB CSC

III. OPIF as a Performance Management System

Strategic Performance Management System (Individual) (CSC)

Organizational Outcomes

Good Governance

and Anti-Corruption

Human Development

& Poverty Reduction

Economic Development

Security, Justice, and

Peace

Climate Change

Adaptation

Societal Goals/Outcomes

Sectoral Goals/Outcomes

Financial Stewardship

Internal Process Client/Customer

Satisfaction

Leadership, Learning and

Growth

Major Final Outputs (“Client-oriented” Results)

STR (PMS) SONA Technical

Report/

SER (NEDA) Socio Economic

Report

PPARC

(Cabinet

Clusters) Priority

Program

Accountability

Report Card

MARC- I MFO

Accountability

Report Card

MARC- II

(Internal to

agency) Management

Accountability

Report Card

Results-Based Performance Management System

To quality for PBB, agencies must meet at least 90% of PPARC and MARC-I, and satisfy all MARC-II (GG conditions)

Performance-Based Bonus (PBB) – top-up bonus based on individual’s contribution to accomplishment of Department targets

Performance-Based Incentive System (PBIS)

PBB

PEI Productivity Enhancement Incentive (PEI) – across-the-board bonus per employee

Source: AO 25 task Force, 2012

Key Features of PBB Performance targets using MFO PIs contained in Budget

presented to Congress

Good Governance conditions

• Transparency Seal, Procurement Compliance, Citizen Charter, submission of statement of assets & liabilities

Provide Department Heads handle to align system of performance assessment to attached agencies & organizational units

Two-step system of ranking of delivery units and personnel: set group eligibility before individual eligibility

Normalization via forced ranking

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Eligibility Criteria for PBB

Achieve at least 90% for each target under MFO

Achieve at least 90% for each target agreed with President

Meet 100% of good governance conditions set by AO 25 Task Force

Implement two-stage ranking

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Key Gains & Lessons Learned*

• PBIS is improving management practices in target setting, performance appraisal, teamwork.

• Group ranking good for teamwork; 2 stage ranking to avoid free-riding, & reward good performance.

• PBIS has improved compliance to governance standards (Transparency Seal, Philgeps, ARTA, SALN).

• Need to matter more to compensation, especially to managers embed in salary adjustment

• Clear and measurable standards for validation, and timely and accurate information, needed.

• Study impact on employee morale & performance *WB Assessment of PBB based on survey of 1,500 civil servants , June

2014

IV. Monitoring the PIB during Budget Execution

Budget Execution Documents (BEDs) vs. Budget and Financial Accountability Reports (BFARs)

Account Management Teams/ Full-Time Delivery Units

Report to Cabinet and the President

Performance-Based Bonus

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Monitoring Systems

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BEDs BFARs

BED No. 1 Financial Plan (FP)

FAR No. 1 Statement of Appropriations, Allotments, Obligations, Disbursements and Balances (SAAODB) FAR No. 1-A Summary of Appropriations, Allotments, Obligations, Disbursements and Balances by Object of Expenditures (SAAODBOE) FAR No. 1-B List of Allotments and Sub-Allotments (LASA)

BED No. 2 Physical Plan (PP)

BAR No. 1 Quarterly Physical Report of Operations (QPRO)

BED No. 3 Monthly Disbursement Program (MDP)

FAR No. 4 Monthly Report of Disbursements (MRD)

BEDs vs. BFARs

Way Forward

Creation of an MFO/PI Register to track performance

Next phase of PIB: Program Expenditure Classification (PREXC)

Strengthen monitoring and evaluation

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Thank you!

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