Presentation on theme: "REPUBLIC OF THE PHILIPPINES EUROPEAN UNION"— Presentation transcript:
1 REPUBLIC OF THE PHILIPPINES EUROPEAN UNION DCI-ASIE/2011/SUPPORT TO LOCAL GOVERNMENT UNITS FOR MORE EFFECTIVE AND ACCOUNTABLE PUBLIC FINANCIAL MANAGEMENT(LGU PFM 2)Philippine Association for Government Budget AdministrationApril 3, 2013Presented by: Annabelle Ceniza-Echavez, DBM-RO VIIWe are pleased to provide you an overview of the four-year European Union-funded project, which shall be officially known as, “Support to Local Government Units for More Effective and Accountable Public Financial Management.” For brevity, we shall be referring to the project as the LGU PFM 2 project as we consider the same as the second PFM improvement project for LGUs, the first being the PFM improvement component implemented under the EU-funded Health Sector Policy Support Programme (HSPSP) I, implementation period was (EC Grant of 33M).The programme aimed to contribute to the improvement of the health of the Philippines’ poor population and to achieve health-related Millennium Development Goals by enabling the country’s poor to gain and increase their use and access to affordable and financially sustainable, quality essential health services and population programs.
2 RATIONALEThe four-year European Union – funded project was designed considering the following:LGUs are still faced with the challenge of fiscal sustainability; andWeak LGU PFM is due, in part, to poor coordination between the oversight agencies and the LGUs.This four-year programme was crafted taking into consideration two key points: Twenty years after the adoption of the Local Government Code of 1991, which signaled the grant of more powers, authority, responsibilities and corresponding resources to the local government units, LGUS are still faced with the challenge of fiscal sustainability.This is largely due to: (1) continued dependence on national government transfers (Internal Revenue Allotments); (2) Stagnating local revenues; (3) Strong political dynamics that sacrifice policy-based, well-prioritized budget and override internal control/audit measures; (4) corruption undermining effective budget execution and procurement; and (5) lack of coordination and miscommunication. Problems are horizontal as well as vertical. Weak LGU PFM is due, in part, to poor coordination between the oversight agencies and the LGUs. This may be indicative of Regional Offices being unable to fully cascade reforms down to the LGUs and fully serve as link between the national government and the LGUs. Moreover, this may also be attributable to a lack of coordination among the different oversight agencies, thereby, indicating a need to enhance the quality of agency oversight, better alignment of policy guidelines and capacity development for oversight agencies.The project seeks to address these two points by strengthening the capacities of both oversight national agencies involved in LGU PFM and enhancing the capacity of LGUs to generate and manage their resources.Support to Local Government Units for More Effective and Accountable Public Financial Management
3 OBJECTIVES Overall: Specific: To contribute to the achievement of the Millennium Development Goals (MDGs) and poverty reduction in the Philippines, in line with the Philippine Development Plan, through improved public financial management resulting in improved delivery of basic services by local governments.Specific:To enhance capacity of local governments to generate revenue and to allocate and spend public funds more effectively and efficiently.Overall, the project seeks to contribute to the achievement of the Millennium Development Goals (MDGs) and poverty reduction in the Philippines, in line with the Philippine development Plan, through improved public financial management resulting in improved delivery of basic services by local governments. The Aquino Administration is pursuing the Millennium Development goal of reducing poverty from 26.5 % in 2009 to 16.6 % by 2015.Specifically, the project seeks to enhance capacity of local governments to generate revenue and to allocate and spend public funds more effectively and efficiently.Support to Local Government Units for More Effective and Accountable Public Financial Management
4 Contracting authority / Paying authority PROJECT BUDGETCategoriesEU contribution(in EUR)Contracting authority / Paying authority1. ServicesTechnical assistanceEuropean CommissionMonitoring, evaluation and audit2. SuppliesEquipment , SoftwareDBM / European CommissionPublications3. Operating costsEvents (training, mentoring, coordination)Office Operating Costs (staff, consumables)4. IECProject Information, Education and Communication materials and mass media campaignsCommunication/Visibility50 0005. ContingenciesContingenciesTOTALThe project has an allocation of 8 Million Euros or 416 Million Pesos 52 to 1 Euro) from the EU.The Government of the Philippines’ contribution, estimated at EUR or P36.4 Million Pesos, shall be in-kind and shall cover:all logistical costs related to the hosting of the technical assistance team foreseen in the programme, such as office facilities, IT equipment, furniture, consumables, telecommunications and mail;all tax expenditure incurred by the project;all costs related to the participation of officials in meetings, workshops and other events as part of the normal functioning of the public services; (this means RDs will have to charge their travel expenses against regular funds when participating in meetings, trainings, etc)all salaries related to the participation of their staff in the programme;any programme-related operating costs not included in the EU contribution.Support to Local Government Units for More Effective and Accountable Public Financial Management
5 OPERATIONAL IMPLEMENTATION PHASE PROJECT PHASESOPERATIONAL IMPLEMENTATION PHASECLOSURE PHASEYear 1Year 2Year 3Year 4Year 5Year 6YEAR 4: JUL 2015 – JUN 2016YEAR 3: JUL 2014 – JUN 2015The project will be implemented over the next six years, the first four years of which will be considered as the operational implementation phase and the last two years as the closure phase.The operational implementation phase will be reckoned from July 3, 2012, which is the date when the Republic of the Philippines signed the Financing Agreement. The Start Up Period commenced last December 27, 2012, the date when the Start Up Programme Estimates (SUPE) was approved. The operational implementation phase will start April 1, 2013 and run until July 2, 2016.The closure phase shall commence July 3, 2016 and run until July 2, 2018.YEAR 2: JUL 2013 – JUN 2014YEAR 1: APR 1 – JUNE 30, 2013INCEPTION PHASE: SEPT 2012 – MAR 2013START: JULY 3, 2012Support to Local Government Units for More Effective and Accountable Public Financial Management
6 KEY RESULT AREASEnhanced capacity of national oversight agenciesImproved institutional capacities of oversight bodies at national level;LGU PFM policy agenda and action plan developed; andStrengthened capacity of ROs;Strengthened local capacity in fiscal and expenditure managementImproved revenue generation and management at LGU level;Improved planning, budgeting and execution;Strengthened internal control / internal audit systems; andLocalized procurement reforms;Strengthened accountability and transparencyStrengthened budget monitoring and evaluation at LGU level;Enhanced effectiveness of LGU performance monitoring systems; andFinancial management leadership developed at LGU level;The project has three key results areas:Enhanced capacity of national government agencies. To attain this, the institutional capacity of the oversight bodies will have to be improved. This entails assessing the institutional needs of DBM with regard to LGU PFM which will be used to refine mandates, training of staff, policy development and institutional strengthening; setting up of a LGU PFM policy support unit within DBM; training and equipping staff to fulfil mandate with regard to LGU PFM; and reinforcing mechanisms to harmonise and coordinate PFM support to LGUs at national and regional levels.This KRA also includes activities for the development of an LGU PFM policy agenda and action plan, which is aligned with the PFM National Roadmap, and which shall consider the results of the PFM assessments and improvement planning exercises undertaken at the sub-national level.Parallel to the strengthening of oversight agencies at the national level, the oversight agency Regional Offices shall likewise be capacitated. This entails analysis of the delivery systems for capacitating LGUs in PFM; defining the roles and responsibilities of ROs with regard to LGU PFM; assessing the capacity of the ROs in light of their roles and responsibilities; training of ROs; and analyzing, developing, implementing and institutionalizing mechanisms to harmonise and coordinate PFM support to LGUs at regional level.Strengthened local capacity in fiscal and expenditure management, which will include activities for the review and refinement of existing manuals on revenue generation, planning and budgeting, internal control/internal audit and procurement. In the process, the Technical Assistance Team of the project is expected to assist the LGUs in exploring the possibility of automating budgeting and accounting processes.Strengthened accountability and transparency will be achieved by strengthening budget monitoring and evaluation at the LGU level. Unlike in the earlier PFM technical assistance given to LGUs covered under the DOH Health Sector Policy Support Programme (HSPSP), monitoring and evaluation will go beyond project/program implementation but will look into how the budget is implemented.Necessarily, we will review the accountability portion of the BOM in order to come up with a system which will truly capture information on budget performance.The third KRA will also include activities that will institutionalize the PFMAT for LGUs. We hope to be able to roll-out the PFMAT to all LGUs starting in 2013 under the auspices of the LGU PFM 2 project. Finally, we also hope to build PFM leadership by conducting fora and consultations with the Local Chief Executives as well as Local Sanggunians in order to obtain more buy-in for PFM reforms.Support to Local Government Units for More Effective and Accountable Public Financial Management
7 EXPECTED OUTPUTSCapacity Building Program/s for Oversight National Government Agencies, including Regional Offices;A PFM Reform Agenda (PFM Roadmap) developed taking into consideration the National PFM Roadmap and results of PFM Assessments and Improvement Planning;Capacity Building Program for LGUs;Updated / Refined Manuals covering Planning and Budgeting, Internal Control/ Internal Audit, Revenue Generation and Procurement, among others;Electronic tools for financial management; andInstitutionalized PFM Assessment (using PFMAT for LGUs) and Improvement Planning in the LGUs.Taking into stock the key result areas and component activities, the following are among the major outputs expected from the project:Capacity Building Program/s for Oversight National Government Agencies, including Regional Offices;A PFM Reform Agenda (PFM Roadmap) developed taking into consideration the National PFM Roadmap and results of PFM Assessments and Improvement Planning;Capacity Building Program for LGUs;Updated / Refined Manuals covering Planning and Budgeting, Internal Control/ Internal Audit, Revenue Generation and Procurement, among others;Electronic tools for financial management; andInstitutionalized PFM Assessment (using PFMAT for LGUs) and Improvement Planning in the LGUs.Support to Local Government Units for More Effective and Accountable Public Financial Management
8 ORGANIZATIONAL STRUCTURE Project Steering CommitteeImprest AdministratorProject Technical Working GroupTechnical Assistance TeamProject Task Force Support StaffImprest Accounting OfficerThe project will be implemented and monitored through the following bodies, which constitute the project’s organizational structure:There will be a Project Steering Committee which shall oversee and validate the overall direction and policy of the project. The PSC shall be chaired by the DBM as executing authority. Representatives of the other participating agencies: DILG, BLGF, NEDA and COA as well as the EU shall serve as PSC members. Observers from the different leagues of LGUs, donors who are active in LGU PFM, LGU PFM Focal Person or Civil Society Organizations shall also be invited in the PSC meetings.The project will have an Imprest Administrator or Project Director and Imprest Accounting Officer or Finance Manager. The two officers shall head the Project Task Force which will be backstopped by an appropriate number of support staff to handle day-to-day operations and serve as secretariat to the PSC.The technical aspect of the project will be largely handled by a Technical Assistance Team. The team has already been contracted and engaged by the EU.Since the project involves several oversight agencies, a Project Technical Working Group shall likewise be established to discuss the technical, administrative, financial and human resources aspects of the project.Support to Local Government Units for More Effective and Accountable Public Financial Management
9 ORGANIZATIONAL STRUCTURE Project Steering Committee:Chair: Sec. Florencio B. Abad (Usec. Mario L. Relampagos)Members:DILG: Usec. Austere A. Panadero(Dir. Annaliza Bonagua / Director Manuel Q. Gotis)BLGF: Usec. Jeremias N. Paul, Jr.(OIC ED Salvador M. del Castillo)NEDA :DDG Margarita R. Songco(Dir. Remedios Endencia)EU RepresentativeCOA :The following officials, so far, shall form part of the project organizational structure:Project Steering Committee:Chair: Sec. Florencio B. Abad, with Usec. Mario L. Relampagos as alternateMembers:DILG: Usec. Austere A. Panadero, with Directors Anna Liza F. Bonagua and Manuel Q. Gotis as alternatesBLGF: Usec. Jeremias N. Paul, Jr. With OIC Executive director Salvador M. del Castillo as alternateNEDA : Deputy Director General Margarita R. Songco with Director Remedios S. Endencia as alternateCOA : sent a letter informing that they will designate an “observer” as appropriateImprest Administrator: Dir. Julian Ll. Pacificador, Jr.Imprest Accounting Officer: Asec. Janet B. AbuelTechnical Assistance Team: Mr. Ian Collins, et.al.Support to Local Government Units for More Effective and Accountable Public Financial Management
10 ORGANIZATIONAL STRUCTURE Imprest Administrator: Dir. Julian Ll. Pacificador, Jr.Imprest Accounting Officer: Asec. Janet B. AbuelProject Technical Working Group:DBM: Dir. Ruby R. Esteban and Dir. Carmencita N.DelantarDILG: Dir. Annaliza Bonagua and Mr. EdwardTemplonuevoDOF: Dir. Divina Corpuz and Ms. Maria Paz JavierNEDA: Dir. Remedios Endencia and Mr. Alih Faisal AbdulSupport to Local Government Units for More Effective and Accountable Public Financial Management
11 STATUS OF IMPLEMENTATION PSC and PTWG already organizedTAT already mobilized and hosted at the DBMStart Up Activities already underwayPreparation of Overall and Annual Work Plans ongoingNEXT STEPS:Completion by the TAT of the Project’s Inception ReportPreparation and implementation of the First Operational Programme EstimatesCurrently, the PSC and PTWG have already been organized. We had the first Joint Organizational Meeting last January 24-25, 2013 in Manila.The Technical Assistance Team has already been mobilized and is currently hosted by/at the DBM.The start up activities are underway and we are in the thick of preparing the project’s overall and annual workplans.For our next steps, the TAT is expected to complete the project’s inception report which shall guide the implementation of project activities during the implementation stage of the project.Also part of the start up activities is the preparation of the first operational programme estimates which shall cover the next 14 months recknoned from May 1, 2013.After the Programme Estimates’ approval, the activities covered by the PE shall be implemented by the different participating agencies: DBM, DILG, DOF-BLGF, NEDA and COA.Support to Local Government Units for More Effective and Accountable Public Financial Management
12 REPUBLIC OF THE PHILIPPINES EUROPEAN UNIONDCI-ASIE/2011/THANK YOU
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