DBM

1. NATIONAL BUDGET
(PHILIPPINES SETTING)
Presented by:
MERAFE A. EBREO

2. Government Budget
A plan for financing the government
activities of a fiscal year preparedand
submitted by responsible executive to
arepresentative body whose approval
andauthorization are necessary before the plan
can beexecuted. It is more than mere estimate
orstatement of receipts and expenditures; it is
adefine proposal to be approved or rejected.

3. Advantages of Budgeting
1.Action is based on study.
2. Cooperation is secured in the entire organization.
3. Policies are established.
4. Programs of activities are related to expected or
available resources and economic conditions.
5. Balanced Programs are developed.
6. Coordinated effort is attained.
7. Operations are controlled.
8. Weaknesses in the government are revealed.
9. Wastes are prevented.

4. Kinds of Budgets
I. As to Nature:
A. Annual Budget- a budget which covers a period of
one year. It is the basis of an Annual appropriation.
B. Supplemental Budget- a budget which purports to
supplemental or adjust a previous budget which is
deemed to inadequate for the purpose for which is
intended.
C. Special Budget- a budget of special in nature and
submitted in a special forms on account of the fact
that itemizations are not adequately provided in the
Appropriation Act or that amounts are not included
in the Appropriation Act.

5. II. As to Basis
A. Performance Budget- a budget
emphasizing the programs or services
conducted and based on functions, activities
and projects which focus attention upon the
general character and nature of work to be
done upon services to be rendered rather
than the things to be acquired such as
personal services, supplies and equipment.
B. Line Item Budget- a budget the basis of
which are the objects and expenditures such
as salaries and wages, travelling expenses,
freight, supplies, materials, equipment etc.

6. III. As to Approach and Technique
A. Zero-Based Budgeting- a process which
requires systematic consideration of all
programs, projects and activities with the use
of the defined ranking procedures.

7. IV. Other Forms of Budget
A. Regional Budgeting- is a budget prepared
consistent with the regional organization of the
National Government, wherein the DBM
identifies by region the expenditures of
government agencies and releases of funds also
on a regional basis.
B. Long-Term-Budget- is a budget prepared for four
or five year period or longer; longer range
estimate revenue and expenditures
requirements.

8. C. Key Budgetary Inclusions- refer to financial
commitments of agencies pertaining to
budget year. KBIs are maintained for the
purpose of:
1. controlling major financial commitments so
that funds are not misappropriated or to
prevent juggling of funds.
2. to disclose the funds and have clear picture
of the expenditures; and . To track down
mandatory obligations and insure funding of
priority projects

9. Legal Basis of the Budget System
Budget Reform Decree
or P.D No. 1177

10. 1. The formulation of the budget that supports
the national development plan and reflects the
objectives and strategies of the plan.
2. 2. The preparation of budget within the context
of the total resources of government, including
revenues and receipts, expenditures and
borrowings of national and local government
units, including government and controlled
corporation.
3. 3. The preparation of the annual budget as an
integral part of a long-term plan and long-term
budget program

11. 4. The specification of multi-year requirements in
each state of the budget process.
5. The preparation of the budget at the regional
level, consolidation and review at the department
and central levels, taking into consideration the
goals, plans and requirements of the regional
offices in the interest of full government response
to local thinking and initiative.
6. The implementation and timing of major
development projects which may affect the
infrastructure program, debt ceilings, domestic
credit, balance of international payments and
determination of expenditure levels to insure the
observance of established fiscal, monetary,
international payment and other constraints.

12. 7. Analysis of budget estimates on a zero-base
approach rather than on percentage or
incremental approach.
8. Basis for legislative discussion of the budget,
limiting the time allotted for debate on the
budget by the legislative body, thereby ensuing
that the budget is approved before the start of
the fiscal year.
9. Adoption of a management information system
for effective performance monitoring and
financial evaluation and the development of
standard costs for units of work measurement, in
order to efeectively evaluate agency programs.

13. What is a National Budget?
It is the government’s estimate of its
income and expenditures. It is what the
government plans to spend it for programs
and projects and where the money will come
from.Two major sources of money for our
National Budget:
1. Revenues
2. Borrowings

14. Four Process of Budgeting
1. Budget Preparation- this place covers the
estimation of government revenues, the
determination of budgetary priorities and
activities and the translation of these
priorities and activities into budgetary
estimates.
2.Budget Authorization- this phase includes the
legislative body reviews the budget proposals
of the President and formulates an
appropriation act in accordance with the
process specified in the Constitution.

15. 3. Budget Implementation/ Execution- This
phase covers the various operational aspects
of budgeting. This is the point where the
agency can make use of the approved
appropriation.
4. Budget Accountability- this phase of the
budget process is concerned with tracking and
monitoring of actual expenditures, revenues,
assets and liabilities of government agencies.
It is particularly involved in the evaluation of
expenditures and performance.

16. On what is our national budget
spent?
It is allocated for the implementation
of various programs and projects, the
operation of government offices,
payment of salaries of government
employees and payment of public
debts.

17. Expenditures by expense class show
how much is much is provided:
1. Current Operating Expenditures-appropriations
for the purchase of goods and
services for conduct of normal government
operations within a budget year; such as the
salaries, maintenance and operating expenses,
interest payment etc.

18. 2. Capital Outlays- appropriations of goods and
services the benefits of which extent beyond the
budget year and which add th the assests of the
government including investments in the capital
stock of government oend or controlled
corporations.
3. Net Lending- net advances by the national
government for the servicing of government
guaranteed corporate debt and loans outlays by
the national government corporations
4. Debt amortization- contribution to the sinking
fund which is utilized for principal repayments of
our loans

19. REFERENCES:
http://www.slideshare.net/alonasalva/nationa
l-budget-14408344 (Lon Salva)
http://www.dbm.gov.ph/?page_id=352

20. Thank You!