Presentation on theme: "Linking the Plan to the Budget"— Presentation transcript:
1Linking the Plan to the Budget Getting to Know the New AIPDivina Luz Lopez, 2007; presented by Francisco Magno, January 2012
2LINKING THE PLAN TO THE BUDGET Local budgets shall operationalize approved local development plans (Sec. 305 (i), RA 7160)Local Development Plan (LDP/CDP)Local Development Investment Program (LDIP)Local BudgetAnnual Investment Program (AIP)
3Plan – Budget Flow LOCAL DEVELOPMENT PLAN (LDP/CDP) Practical Vision / Strategic DirectionsLong-Term (5 – 10 Years)LOCAL DEVELOPMENT INVESTMENT PROGRAM (LDIP)Programs / Projects/ Activities (PPAs)Medium Term (3 Years)ANNUAL INVESTMENT PROGRAM (AIP)Priority PPAs; Major Final Output; Performance Indicators / TargetsShort Term (1 year)ANNUAL / SUPPLEMENTAL BUDGETOne (1) year
4LOCAL PLANNING & BUDGETING LINKAGE LOCAL DEVELOPMENT PLAN (LDP)Medium – Term (At least 6 Years)PLANNINGDevelopment IssuesCurrent RealityVisionGoals and ObjectivesEXECUTIVE AND LEGISLATIVE AGENDA (ELA) (3 Years)LOCAL DEVELOPMENT INVESTMENT PROGRAM (LDIP)Programs/Projects/Activities(3 – years)LINKInvestment ProgrammingANNUAL INVESTMENT PROGRAMPriority PPAsPerformance Indicators / Targets (1 Year)BUDGETINGPriority Programs/Projects/ ActivitiesAllocation of ResourcesMajor Final Output /Performance Indicators / TargetsANNUAL / SUPPLEMENTAL BUDGET(1 Year)
5LOCAL PLANNING & BUDGETING LINKAGE The linkage between planning & budgeting takes place when the AIP, after having been reviewed & endorsed by the Sanggunian, is used by the LFC in the preparation of sectoral ceilings.BUDGETPLANINVESTMENT PROGRAM
6Long-term vision & strategic direction CONTENTS OF THE NEW AIPAIP FORM NO. 1Practical Vision and Strategic DirectionsNEW AIPSpecific Objectives, Targets & Policy DecisionsAIP FORM NO. 2Long-term vision & strategic directionAIP FORM NO. 3Program / Activity / Project ComponentMedium- term objectives & Policy decisionsLINKING PIN BETWEEN THE PLAN & THE BUDGETPrioritized annual investment schemesAIP FORM NO. 4Priorities by Program / Activity / Project
7AIP FORMAT Practical Vision Strategic Directions Specific Objectives AIP for Budget Year ___________Municipality / City of _______________________________Province of __________________________________________Executive SummaryPractical VisionStrategic DirectionsSpecific ObjectivesPolicy DecisionsDetails of P/ P/ As by SectorPriorities for the Budget YearAnnexesAIP FormsLDC Resolution endorsing the AIP for the Budget YearLocal Sanggunian Approving the AIP for the Budget Year
8TIMETABLE AND ACTIVITY FLOW OF THE AIP PREPARATION PROCESS PERIOD COVEREDACTIVITY FLOWLCE issues Executive Order directing the updating of the LDIP & the AIPJanJanReview of all objectives and policiesObjective setting / Strategy formulationPolicy revision/ formulationPrioritization of PPAsConsolidation of revised objectives, strategies & prioritized PPAsFebFebInput review results in AIP formsMulti-stakeholder consultation on draft AIP
9TIMETABLE AND ACTIVITY FLOW OF THE AIP PREPARATION PROCESS PERIOD COVEREDACTIVITY FLOWMarch 1-15Match investment requirements with available resources.Revise draft AIP if resources are inadequate; formulate needed policiesFinalize AIP for endorsement to SanggunianSanggunian deliberatesLFC elevates to higher LGU/ NGRO AIP – identified projects that cannot be financed by the concerned lower LGU.March 16-30April 1- 30Higher LDC deliberates on projects proposed by lower LGU for funding.
10TIMETABLE AND ACTIVITY FLOW OF THE AIP PREPARATION PROCESS PERIOD COVEREDACTIVITY FLOWMay 1- June 15LFC prepares profiles of PPAs to be funded from the General Fund of the LGUJune 16-30LCE issues “Budget Call” based on AIP (done after the initial IRA share is released by DBM)LFC finalizes spending ceiling by sector/ officeLFC conducts workshop / forum on the Budget CallJuly 1-Aug. 15Department Heads prepare & submit budget proposalsAug. 16–Sept. 15LFC conducts technical budget hearings on proposals submitted by Department Heads
11TIMETABLE AND ACTIVITY FLOW OF THE AIP PREPARATION PROCESS PERIOD COVEREDACTIVITY FLOWLFC consolidates budget proposals into a Local Expenditure Program (LEP) and prepares the Budget of Expenditure and Sources of Financing (BESF)SeptOctLCE prepares Budget message & submits the same to the Sanggunian with the Executive Budget consisting of the LEP & BESF.
12LOCAL FINANCE COMMITTEE WHAT TO DO WITH FINISHED AIPLOCAL FINANCE COMMITTEEConducts review of the projected revenue or projected income projected during the budget year;Recommend appropriate tax and other revenue measures or borrowings to support the budgetThe LCE submits the AIP to the LFCRecommends resource allocation measures and spending ceilings for the economic, social and general services sector.May elevate to higher LGU or NGA PPAs that cannot be supported by local revenues.
13WHAT TO DO WITH FINISHED AIP LOCAL DEVELOPMENT COUNCILEndorses AIP to SanggunianSANGGUNIANapproves AIPPrepares project profiles / project briefsLOCAL FINANCE COMMITTEE
14Spending ceiling per sector/ office is finalized by the LFC WHAT TO DO WITH FINISHED AIPSpending ceiling per sector/ office is finalized by the LFCIRABudget forum / workshop is called by the LFCTechnical hearings conducted on budget proposals submitted by Department heads
15Budget LEP WHAT TO DO WITH FINISHED AIP BESF Proposals are consolidated by the LFC into a Local Expenditure Program (LEP).LEPA companion document called the Budget of Expenditure and Sources of financing will also be preparedBESFBudgetEXECUTIVE BUDGET
16Budget THE EXECUTIVE BUDGET BESF LEP Discloses the extent of LGU compliance with the budgetary requirements under the Local Government Code & tax collection efficiencyBESFDetailed & graphical presentation of the expenditure program of the LGURationale for any proposed revenue generating measures to be implemented during the budget year.3-year comparative trend analysis of the expenditure program by sector, office/departmentBudgetGoals, objectives, policies & strategies & priority PPAs for the BYReflects income estimates, sources of funds that will finance the budget & how such income is allocated.Provides the basis & justification for policy decisions contained in the Executive BudgetDetermines the average cost of services per taxpayer & correlates the same with the proposed increases for the budget yearEstimates of IncomeExpenditure ProgramGuidelines on the Special Purposes AppropriationGuidelines on the General ProvisionsGuidelines on the Summary of the Fiscal Year New AppropriationLEPPresents trend analysis of the revenue share from IRA & other ALGU shares in comparison with locally-generated income
17Budget advocacy : a process to influence policy decisions on budgeting Local budget advocacy: A course of action that hopes to influence the budgeting process to ensure that the budget serves as a vehicle for moving the LGU towards the attainment of its vision, and achieve its goals, objectives and targets in the medium – and short – term
18CAN BE SUSTAINED IF ADVOCATES: BUDGET ADVOCACYCAN BE SUSTAINED IF ADVOCATES:understand the local government budget, its processes and cycle;understand the difference yet close linkage between AIP preparation and the actual budget that is being presented;are familiar with the key actors and the institutions involved and the arenas of engagement for them to effectively push for their priorities to be included in the local budget;have a deep appreciation of the technical tools or methods of analyzing and preparing the budget
19POWER MAPPING is a tool for: BUDGET ADVOCACYAdvocates should be able to gauge their capacity to influence the AIP preparation and budget allocation process before embarking on budget advocacy activities.POWER MAPPING is a tool for:analyzing the positions and interests of the different stakeholders in the AIP and the Local Budget;identifying all those who wield either a positive or negative influence on the AIP and budget preparation and approval process;anticipating their possible involvement and actions on the AIP and the Budgetunderstanding the degree of influence of various stakeholders in relation to the AIP and the Local Budgetidentifying approaches to dealing with specific stakeholders who could contribute the most toward the resolution of policy issues in connection with the AIP and budget preparation
20BUDGET ADVOCACY POWER MAP VERSION 1 Person / Group Position on the IssuesReasonsProAntiUndecided
21BUDGET ADVOCACY Power Map (Version 2) Person/ Group Will be Benefited/ Will be Affected PositivelyWill Be Injured/Will be Affected NegativelyPossible Action or Reaction
23BUDGET ADVOCACY Power Map (Version 4) Person / Group Interest or ObjectiveDegree of Influence
24VIPs You Need to Know While Doing Budget Advocacy “MONEY BAGS”TREASURER & ASSESSORBUDGET OFFICERSANGGUNIANLCELPDOACCOUNTANTABC CHAIRCONGRESSMANHEADS OF NGAsADMINISTRATOR“PRESSURE MAKERS” (CSOs, Private sector, etc.
25DURING AIP PREPARATION Arenas and Modes of Engagement for Budget AdvocacyDURING AIP PREPARATIONget involved in the Strategic Direction–Setting Workshop to elicit concrete, specific, realistic priority actions or development strategies to being the LGU to attain its vision;influence the LFC and the LCE in the formulation of policy decisions that are embodied in the AIPpush for inclusion among the priority PPAs those that are truly responsive to the needs of the community rather than those that have been proposed merely for political considerationstake part in Investment Planning and Prioritization Workshop in order to come up with the lists and rankings programs, projects and activities to be implemented; andget accreditation as members of the LDC or LFC, or obtain invitation to participate and get involved in the planning and budgeting functions of the said bodies;contribute in the identification and prioritization of PPAs and preparation of project profiles or briefs.share insights and information on the overall development situation in the community by conducting Current Reality Dialogues with the LGU;
26DURING BUDGET PREPARATION Arenas and Modes of Engagement for Budget AdvocacyDURING BUDGET PREPARATIONvalidate the local budget for consistency with the AIP;influence department heads in the accurate determination of targets or beneficiaries in their PPAs;submit recommendations for increasing revenues to support the proposed local budget.