News and Features

[Part 1] A not so deliberate agenda: How the 14th and 15th House of Representatives funded ARMM and Muslim Mindanao through a thematic analysis of Congressional Records

Part 1: Introduction and the ARMM appropriations

For most of September 2013, the Government of the Philippines (GPH) faced a stand-off against the rebel faction of the Moro National Liberation Front (MNLF).[1][2][3][4][5] The rebel faction, headed by Nur Misuari[6][7], the former regional governor of the Autonomous Region of Muslim Mindanao (ARMM), razed through Zamboanga City, a primary centre of commerce in the main island group of Mindanao.

The initial attacks were said to be well-timed[8] with the expected signing of the remaining annexes of the Framework Agreement on the Bangsamoro (FAB), a peace agreement that seeks to end hostilities in Muslim Mindanao by addressing the needs of the region[9]. Through the signing of the FAB annexes between the Moro Islamic Liberation Front (MILF) and the GPH, the Bangsamoro Transition Commission can draft a Bangsamoro Basic Law with the FAB as framework in hopes to put an end to war that has aggrieved and hampered the region’s socio-economic development [10].

Misuari, earlier this year, in his declaration of independence through the establishment of the MNLF-led United Federated States of Bangsamoro Republik (UFSBR), noted his group’s discontent with the FAB and the PNoy administration’s management of former talks with MNLF that ended during the time of Ramos[11]. GPH, through the Office of the Presidential Adviser on the Peace Process (OPAPP), however, denies Misuari’s allegations on abrogating previous talks[12].

Nevertheless, one bottom-line of the “Zamboanga Crisis” is the issue of the region’s continued state of poverty vis-à-vis supposed state investments not just on ARMM but on Muslim Mindanao, in general. The crux of the matter, which this essay tries to weigh, is two-fold: (1) was ARMM well-funded and (2) how did this funding come into the picture through the Congress.

Looking at a National Budget

A national budget is fundamental in ensuring a government’s ability to increase its credibility and sustainability in achieving public policy goals[13] and other desired outcomes. While it is the foundation of economic management[14] and is representative of national political priorities and policies[15], it is also highly susceptible to politicisation.[16][17]

Therefore, on the one hand, it presents which sectors will receive a larger portion of public money and of the state’s attention. On the other hand, the national budget and its creation process can resolve internal disputes by giving stability[18], and legitimacy and security[19] to internal institutions and the very state.

As a core policy matter on public management, the budget provides integrative functions and dispute-resolution abilities through direct investments on societal needs[20] and through the provision of macroeconomic stability[21] which leads to state legitimacy.[22]

Most First World studies on the national budget are already measuring the performance impact of the budget through quantitative measures.[23][24][25][26][27][28][29][30][31][32] Meanwhile the rest of literature on the budget on non-First World Countries like India and the Philippines, were more concerned on the production of the budget based on stakeholders and on policies and were more qualitative.[33][34][35][36][37][38][39][40][41][42]

Appropriations for ARMM

The National Budget in the Philippines undergoes four main phases: (i) budget formulation of the Executive, (ii) budget legislation, (iii) budget execution or spending, and (iv) audit and accountability of the budget (DBM, 2013). This paper refers and has been referring to the first two phases as (1) budget preparation and the latter two phases as (2) budget execution.

When the budget is formulated by the Executive branch of government, agencies submit proposals within specified limitations handed by the Department of Budget and Management (DBM) through the Budget Call[43]. These proposals are consolidated and reviewed by DBM and is then presented to the President’s Cabinet for further review[44]. Once the Cabinet agrees on the budget, the President publicly presents this proposal as the “National Expenditure Program” or NEP[45].

The NEP is presented to both Chambers of Congress and is tackled separately[46]. The two Houses then consolidate their different versions of the budget and is endorsed for the President’s signature as the General Appropriations Act (GAA), the annual budget law[47].

However, the national budget is not only understood through the GAA. The budget is also accompanied by other relevant documents like the Staffing Pattern, Details of Selected Programs/Projects, and the Budget of Expenditures and Sources of Financing (BESF) among other documents.

Of these documents, the BESF presents the most coherent picture of budget distribution per region. While the GAA presents the budget per agency, program, and expense class, the BESF provides for various tables that might give a better picture on the budgetary data necessary for various research and needs. Table 1 below presents the total ARMM budget for financial years 2008 to 2013 based on released BESF figures.[48][49][50][51][52][53] The succeeding table provides a visualisation of the data below.

Table 1: Click on image for larger display

Table 1: Click on image for larger display

Immediately, these data are indicative of many things. In the past half-decade, the national budget grew by 34.46% from its 2008 figure to this year’s budget. Meanwhile, the percentage share of ARMM in this national budget inched closely with the prior figure at 34.07% growth from the 1.44% share in 2008 to 2.186% share in 2013. This either shows, in a non-mutually exclusive way, that the (i) the budget for ARMM has not kept up with the growing needs of the country given the still-miniscule share, or (ii) the country simply needed to invest in other regions.

Figure 1: Click on image to enlarge

Figure 1: Click on image for larger display

Nevertheless, it cannot be denied that the total budget of ARMM, in nominal terms, increased by a highly substantial 131.43% from its 2008 allocation of ₱18.95-billion to its 2013 allocation of ₱43.84-billion. Specialised allocations for specific departments grew by 226.22% from its 2008 allocation to the current. LGU allocations grew by 39.63% from the last half-decade.

These competing notions on investment, meanwhile, should be noted with a caveat. A region’s allocation for departments specifies region-specific allocations. This means that even if there’s no budget for the Department of Health (DOH) in many of the ARMM budgets, this does not mean that ARMM is devoid of services from DOH. Thus, the noted budgets for departments are special projects by or direct infusions for the departments of the region. A general increase in the total budget of an agency might therefore mean higher net investments in ARMM sans issues of management and absorptive capacity of agencies.

Meanwhile, it should also be noted that year-on-year, the total ARMM budget had good year-on-year increases as shown below.

The budget for 2012 had the highest growth year-on-year at 31.92% larger than the 2011 ARMM budget. This is followed by budgets for 2009 and 2011. It can also be observed that allocations for departments were largest from 2011 to 2013 while LGU allocations were smallest and were at a decline in the same period. There seems to be a shift in operation focus from LGUs to Departments.

Table 2: Click on image for larger display

Table 2: Click on image for larger display

Were there significant events in 2011 and in 2008 that might have spurred for larger appropriations in the years succeeding them? And in the same vein, what were perhaps the events in 2009 that allowed for the miniscule change in the 2010 budget?

This will be tackled in the next part of this essay.

—–

[1] Aben, E. L. & Recuenco, A. B., 2013. 30 MNLF fighters yield. Manila Bulletin, 26 September.

[2] Arcilla, A. F., de Leon, J. A. & Tubadeza, K. M. P., 2013. UN sees ‘humanitarian crisis’ in Zamboanga. Business World, 26 September.

[3] Dizon, N., Alipala, J. S. & Santos, D. J., 2013. Day 15 of Zamboanga siege: Lieutenant dies. Inquirer News, 24 September.

[4]Medina, A., 2013. Timeline: Crisis in Zamboanga City. [Online]

Available at: http://www.gmanetwork.com/news/story/325855/news/regions/timeline-crisis-in-zamboanga-city

[Accessed 27 September 2013].

[5] Pareño, R., 2013. Malls in Zamboanga open as crisis enters 17th day. Philippine Star, 25 September.

[6] GMA News, 2013. MNLF attacks Zambo City, using 20 hostages as ‘human shields;’ six killed. [Online]

Available at: http://www.gmanetwork.com/news/story/325608/news/regions/mnlf-attacks-zambo-city-using-20-hostages-as-human-shields-six-killed

[Accessed 27 September 2013].

[7] Dizon, Alipala, Santos. 2013. “Day 15 of Zamboanga sige: Lieutenant dies.”

[8] GMA News, 2013. MNLF attacks Zambo City.

[9] GPH-MILF, 2012. Framework Agreement on the Bangsamoro. [Online]

Available at: http://pcdspo.gov.ph/downloads/2012/10/20121007-GPH-MILF-Framework-Agreement.pdf

[Accessed 27 September 2013].

[10] Ibid.

[11] Moro National Liberation Front, 2013. Bangsamoro Constitution: Road map to Independence and National Self-Determination. [Online]

Available at: http://mnlfnet.com/Articles/BYC_23Aug2013_Bangsamoro%20Constitution.htm

[Accessed 27 September 2013].

[12] Deles, T. Q., 2013. Statement of Secretary Teresita Quintos Deles On the attack in Zamboanga City by the MNLF group associated with Nur Misuari. [Online] Available at: http://opapp.gov.ph/resources/statement-secretary-teresita-quintos-deles-attack-zamboanga-city-mnlf-group-associated-nur [Accessed 27 September 2013].

[13] Diamond, J., 2003. Budget System Reform in Transitional Economies: The Experience of Russia. Emerging Markets Finance & Trade, January to February, 39(1), pp. 8-23.

[14] Noda, K., 2011. Politicization of Philippine Budget System: Institutional and Economic Analysis on “Pork-Barrel”. Policy Research Institute Discussion Paper Series, March.Issue 11A-04.

[15] Burden, B. C. & Sanberg, J. N. R., 2003. Budget Rhetoric in Presidential Campaigns from 1952 to 2000. Political Behavior, June, 25(2), pp. 97-118.

[16] Blöndal, J. R., 2010. Budgeting in the Philippines. OECD Journal on Budgeting.

[17] Noda, 2011. Politicization of the Philippine Budget System.

[18] Savage, J. D., 2013. Iraq’s Budget as a Source of Political Stability. United States Institute of Peace, March.Issue Special Report 328.

[19] Boyce, J. K., 2007. Public Finance, Aid and Post-Conflict Recovery. University of Massachusetts Amherst Department of Economics, June.

[20] Suhrke, A., Wimpelmann, T. & Dawes, M., 2007. Peace Processes and Statebuilding: Economic and Institutional Provisions of Peace Agreements, Bergen, Norway: Chr. Michelsen Institute.

[21] Andersen, T. M. & Dogonowski, R. R., 2002. Social Insurance and the Public Budget. Economica, 69(275), pp. 415-431.

[22] Call, C. T., 2008. Building States to Build Peace? A Critical Analysis. Journal of Peacebuilding and Development, 4(2), pp. 60-74.

[23] Alt, J. E. & Lassen, D. D., 2006. Transparency, Political Polarization, and Political Budget Cycles in OECD Countries. American Journal of Political Science, 50(3), pp. 530-550.

[24] Alt, J. E. & Lowry, R. C., 2000. A Dynamic Model of State Budget Outcomes under Divided Partisan Government. The Journal of Politics, 62(4), pp. 1035-1069.

[25] Burden & Sanberg, 2003. Budget Rhetoric in Presidential Campaigns.

[26] Andersen & Dogonowski, 2002. Social Insurance and the Public Budget.

[27] Elmendorf, D. W., Liebman, J. B., Shapiro, M. D. & Zeldes, S. P., 2000. Social Security Reform and National Saving in an Era of Budget Surpluses. Brookings Papers on Economic Activity, 2000(2), pp. 1-71.

[28] Ebdon, C., 2000. The Relationship between Citizen Involvement in the Budget Process and City Structure and Culture. Public Productivity & Management Review, 23(3), pp. 383-393.

[29] Gustafsson, B. & Österberg, T., 2001. Immigrants and the Public Sector Budget: Accounting Exercises for Sweden. Journal of Population Economics, 14(4), pp. 689-708.

[30] Gilmour, J. B. & Lewis, D. E., 2006. Does Performance Budgeting Work? An Examination of the Office of Management and Budget’s PART Scores. Public Administration Review, 66(5), pp. 742-752.

[31] Jones, B. D. et al., 2009. A General Empirical Law of Public Budgets: A Comparative Analysis. American Journal of Political Science, 53(4), pp. 855-873.

[32] Jordan, M. M., 2003. Punctuations and Agendas: A New Look at Local Government Budget Expenditures. Journal of Policy Analysis and Management, 22(3), pp. 345-360.

[33] Arroyo, D., 2002. Frequently asked question : national government budget. Makati City: United Nations Development Programme.

[34] Serrano, I. R., 2006. Local Development Plans: Making Social Commitments. Philippine Rural Reconstruction Movement, September.

[35] Blöndal, 2010. Budgeting in the Philippines.

[36] Noda, 2011. Politicization of the Philippine Budget System.

[37] Habito, C. F. & Briones, R. M., 2005. Philippine Agriculture over the Years: Performance, Policies and Pitfalls, Makati City, Philippines: Policies to Strengthen Productivity in the Philippines.

[38] Balakrishnan, P., 2002. The Budget and the Economy. Economic and Political Weekly, 37(12), pp. 1083-1085.

[39] Bhanu, V., 2007. Making the Indian Budget: How Open and Participatory?. Economic and Political Weekly, 42(13), pp. 1079-1081.

[40] Godbole, M., 2001. A Well-Intentioned Budget. Economic and Political Weekly, 36(10), pp. 811-813.

[41] Diamond, 2003. Budget System Reform in Transitional Economies

[42] Mikesell, J. L. & Mullins, D. R., 2001. Reforming Budget Systems in Countries of the Former Soviet Union. Public Administration Review, 61(5), pp. 548-568.

[43] DBM, 2013. 2013’s People Budget, Manila: Philippine Department of Budget and Management.

[44] Ibid.

[45] Ibid.

[46] Ibid.

[47] Ibid.

[48] DBM, 2008. Regional Allocation of the Expenditure Program, By Department/Special Purpose Fund, FY2008. [Online]

Available at: http://www.dbm.gov.ph/wp-content/uploads/BESF/BESF2008/Table%20B/B.8.pdf

[Accessed 27 September 2013].

[49] DBM, 2009. Regional Allocation of the Expenditure Program, By Department/Special Purpose Fund, FY 2009. [Online]

Available at: http://www.dbm.gov.ph/wp-content/uploads/BESF/BESF2009/B.8.pdf

[Accessed 27 September 2013].

[50] DBM, 2010. Regional Allocation of the Expenditure Program, By Department/Special Purpose Fund, CY2010. [Online]

Available at: http://www.dbm.gov.ph/wp-content/uploads/BESF/BESF2010/TableB.8.pdf

[Accessed 27 September 2013].

[51] DBM, 2011. Regional Allocation of the Expenditure Program, By Department/Special Purpose Fund, FY2011. [Online]

Available at: http://www.dbm.gov.ph/wp-content/uploads/BESF/BESF2011/B/B8.pdf

[Accessed 27 September 2013].

[52] DBM, 2012. Regional Allocation of the Expenditure Program, By Department/Special Purpose Fund, FY 2012. [Online]

Available at: http://www.dbm.gov.ph/wp-content/uploads/BESF/BESF2012/B/B8.pdf

[Accessed 27 September 2013].

[53] DBM, 2013. Regional Allocation of the Expenditure Program, By Department/Special Purpose Funds, CY 2013. [Online]

Available at: http://www.dbm.gov.ph/wp-content/uploads/BESF/BESF2013/B8.pdf

[Accessed 27 September 2013].