People's Participation in the National Budget Process Act

TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session JUIL 14 P2:41 RICI SENATE Senate Bill No. Introduced by Senator JOEL VILLANUEVA AN ACT AN ACT INSTITUTIONALIZING THE PARTICIPATION OF CIVIL SOCIETY ORGANIZATIONS (CSOs) IN THE PREPARATION AND AUTHORIZATION PROCESS OF THE ANNUAL NATIONAL BUDGET, PROVIDING EFFECTIVE MECHANISMS THEREFOR, AND FOR OTHER PURPOSES EXPLANATORY NOTE The national budget is the most important expression of government priorities and public accountability. It reflects not only how the government allocates resources, but also whose voices are heard in the decision-making process. Based on the latest Open Budget Survey, an independent and comparative survey conducted by the International Budget Partnership (IBP), while the Philippines scored 33 points over 100, it is still higher than the global average of 15 points in terms of "public participation" or "formal opportunities offered to the public for meaningful participation in the different stage of the budget process. "1 Findings of the survey reveal that while the Philippines scored high in the audit phase of the budget (78 points out of 100), there are minimal opportunities for participatory budgeting during the formulation (33 points out of 100), approval (11 points out of 100), and implementation (25 points out of 100). 2 International Budget Partnership. Open Budget Survey 2023. Published on 29 May 2024. Available at https://internationalbudget.org/open-budget-survey/open-budget-survey-2023 (Accessed on 2 luly 2025). International Budget Partnership. Open Budget Survey 2023. Published on 29 May 2024. Available at https://internationalbudget.org/open-budget-survey/country-results/2023/philippines (Accessed on 2 July 2025).

Overall, the Philippines ranked 13th in the world in terms of Public Participation3 but there is always room for growth and improvement. Strengthening the government's efforts to promote participatory budgeting and inclusion of stakeholders in the process of allocating state resources will ensure transparency and accountability. By establishing formal mechanisms for civil society organizations' (CSO) participation, including access to budget documents, opportunities for consultation, and the ability to submit proposals and feedback, the bill ensures that citizens are not merely passive recipients, but active contributors in shaping the national budget. This proposed measure also responds directly to calls for an "open bicam", where bicameral conference committee discussions can be subject to greater scrutiny. Thus, this bill contains the following features for the promotion of participatory budgeting: a) Establishes mechanisms for CSO participation in the preparation and authorization of the annual General Appropriations Act, such as participating as resource persons during hearings and other similar events, observing during budget deliberations, among others; b) Ensures access to budget-related documents, such as budget proposals, issuances, and committee reports; c) Provides opportunities to present proposed budget proposals and positions on budgetary items, including during the budget deliberations; and d) Enumerates the benefits and privileges of accredited CSOs participating in the budgetary process, but guarantees that non-accredited CSOs shall still participate in the budgetary process through the submission of position papers and observance of public meetings, hearings, conferences, or other similar dialogues in the preparation of the budget. For these reasons, the passage of this measure is earnestly sought. рим- JOEL VILLANUEVAO International Budget Partnership. Open Budget Survey 2023. Published on 29 May 2024. Available at https://internationalbudget.org/open-budget-survey/rankings (Accessed on 2 July 2025)

TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES ) First Regular Session ) JUL 14 P2:41 RECES, D SENATE Senate Bill No. 53'7 Introduced by Senator JOEL VILLANUEVA AN ACT AN ACT INSTITUTIONALIZING THE PARTICIPATION OF CIVIL SOCIETY ORGANIZATIONS (CSOs) IN THE PREPARATION AND AUTHORIZATION PROCESS OF THE ANNUAL NATIONAL BUDGET, PROVIDING EFFECTIVE MECHANISMS THEREFOR, AND FOR OTHER PURPOSES Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Short Title. - This Act shall be known as the "People's Participation

in the National Budget Process Act."

SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State

to facilitate the establishment of adequate consultation and feedback mechanisms to promote meaningful and effective participation of Civil Society Organizations (CSOs) in the preparation and authorization of the annual national budget in order to ensure that the annual appropriations will be an instrument of development that is reflective of the national objectives, strategies and plans beneficial to the people.

SEC. 3. Definition of Terms. - For purposes of this Act, the following terms be

defined as follows: a) Accreditation refers to the registration process of CSOs with the National Government Agencies (NGAs) and Government Owned and Controlled Corporations (GOCCs), in order to allow them to participate in the preparation and authorization of the annual national budget;

b) Accredited CSO refers to CSOs that have fulfilled the requirements in Section 5 of this Act; C) Budget Call refers to the budget document issued by the Department of Budget and Management (DBM) and sent to all NGAs and GOCCs, which contains the policy guidelines and procedures in the preparation of the annual budget, including the budget preparation calendar for any given year. The issuance of a budget call signals the beginning of the budget preparation phase; d) Civil Society Organizations (CSOs) include, but is not limited to, non- government organizations (NGOS), cause-oriented groups, people's organizations, cooperatives, trade unions, professional associations, faith-based organizations, media groups, indigenous peoples' movements, foundations, and other citizen groups formed primarily for social and economic development, which monitor government projects, engage in policy discussions, and actively participate in collaborative activities with Government; Conflict of Interest refers to a situation where it may be reasonably deduced that a CSO or any of its key officers may not act in the public interest due to some private, pecuniary, or other personal considerations which prevent an impartial or unbiased attitude towards their participation in the national budget process; t) Government-Owned or Controlled Corporation (GOCC) refers to any agency organized as a stock or non-stock corporation, vested with functions relating to public needs whether governmental or proprietary in nature, and owned by the Government of the Republic of the Philippines directly or through its instrumentalities either wholly, or where applicable, as in the case of stock corporations, to the extent of at least a majority of its outstanding capital stock; and National Government Agency (NGA) refers to a unit of the National Government, including the Judiciary, both Houses of Congress, and Constitutional Offices.

SEC. 4. Coverage. - This Act shall apply to all NGAs and GOCCs whose budget

is included in the annual General Appropriations Act.

SEC. 5. Accreditation. - The application for accreditation for the Senate, the

House of Representatives, the Judiciary, and the Constitutional Offices shall be filed at the Office of the Secretary, the Secretary-General, the Supreme Court Clerk of Court, and the Office of the Chairperson, respectively. The application for accreditation for other NGAs and GOCCs may be filed at their respective regional or central office. The application form shall be prescribed by each office and the application for accreditation shall be accompanied by the following documents: a) Articles of Incorporation and By-Laws of the applicant CSO; b) Certificate of Registration and/or other similar documents, issued by an appropriate government agency tasked to register civil society organizations, such as, but not limited to, the Securities and Exchange Commission, Bureau of Labor Relations, Housing and Land Use Regulatory Board, Insurance Commission, and the Cooperative Development Authority; The list of officer/s, director/s, trustees, beneficial owner/s, and members; d) Duly audited financial statements for the past three (3) years showing the assets and liabilities of the organization; e) Full disclosure of the sources of funds; and t) Full disclosure of service contracts with other NGAs, CSO, private corporations, other CSOs, and other engagements which may result in conflict of interest. Upon approval of the application, the head of the concerned NGA or GOCC shall issue the certificate of accreditation. This shall be valid for three (3) years following its issuance, except for the certificate of accreditation issued by the Senate and the House of Representatives, which shall be valid for the entire term of the Congress under which such certificate of accreditation was issued. No application for accreditation shall be disapproved, except upon due notice and hearing. The decision of the head of the concerned NGA or GOCC shall be rendered within twenty (20) working days from the time of the filing of the application. Failure to act on the application shall be deemed an automatic approval of the application for accreditation of the concerned CSO, and the issuance of a certificate of accreditation shall necessarily ensue.

SEC. 6. CSO Participation. - In the interest of transparency, CSO participation

shall be a component in the preparation and authorization of the annual national

budget. All NGAs and GOCCs shall be required to formulate and adopt guidelines 2 outlining the mechanism for the accreditation and active participation of the CSOs in the preparation and authorization of the annual national budget. The DBM shall ensure that the NGA or GOCC has complied with the abovementioned requirement. For this purpose, the DBM shall establish capacity- 6 building mechanisms for NGAs and GOCCs and other initiatives for the effective implementation of participatory budgeting involving CSOs with a view to improving fiscal transparency and accountability in the budget process. Accredited CSOs, through their duly authorized representatives, shall, as far as 10 practicable, be allowed to participate as resource persons in the budget hearings to be conducted by the appropriate Committees of the Senate and the House of Representatives, subject to the guidelines to be issued by both Houses of Congress. Notwithstanding their participation in the budget hearings to be conducted by the appropriate Committees of the Senate and the House of Representatives as provided in the preceding paragraph, the Committee on Appropriations of the House of Representatives and the Committee on Finance of the Senate shall schedule one (1) hearing day for the presentation of the positions of accredited CSOs on the budget.

SEC. 7. Privileges and Incentives. - An accredited CSO shall enjoy the

following privileges and incentives: a) To have the same participation rights accorded to NGOs in the Local Development Councils pursuant to the provisions of Republic Act No. 7160, otherwise known as the "Local Government Code of 1991" in setting the direction of economic, social and other coordinating development efforts in the national level; b) To receive notices and participate as resource persons, through its duly authorized representatives, in any regular and consultative public meetings, hearings, conferences, and dialogues on matters related to the preparation and authorization of the annual national budget, subject to the guidelines as may be issued by each House of Congress; C) To be allowed to attend and observe the budget deliberations, including the proceedings of the bicameral conference committee on the General Appropriations Bill, through duly accredited representatives;

1 d) To have access to copies of the budget proposals submitted by the NGAs or GOCCs to the DBM, subject to applicable guidelines on privilege information and/or freedom of information; e) To provide position papers to the DBM on the budget proposal of NGAs or GOCCS submitted pursuant to the budget call; To present and submit its own alternative or proposed budget or position paper; g) To have access to issuances such as, but not limited to, policy orders, circulars and memoranda that are related to the budget; 9 h) To have access to the documents prepared by the DBM for submission to Congress as a basis for the General Appropriations Bill required under Article VII,

Section 22 of the Constitution;

i) To present written proposals on projects and activities of the government entities whose budget is under deliberation; and To have immediate access to stenographic notes and committee reports released by both Houses, including the bicameral conference committee report, subject to such guidelines as may be set by each House of Congress.

SEC. 8. Notice to CSOs. - Notice to accredited CSOs under Sections 7(a) and

(b) of this Act may be sent through electronic mail, facsimile transmission, postal mail, and by posting at the website of the NGA or GOCC concerned.

SEC. 9. Conflict of Interest. - It is the responsibility of the CSO to inform the

21 NGA or GOCC of a conflict of interest in their work with the concerned agency, if and when such situation arises. However, if the NGA or GOCC deems that the CSO has a conflict of interest with the work of such NGA or GOCC, the latter shall give the applicant-CSO an opportunity to explain and prove that the conflict of interest does not exist, in compliance with

Section 5 of this Act.

SEC. 10. Cancellation of Accreditation. - Upon receipt of a verified complaint

in writing, which charges the holder of a certificate of accreditation of having procured their certificate of accreditation by fraud or deceit, or in view of undisclosed conflict of interest, the head of the NGA or GOCC shall notify and serve a copy of the complaint to the CSO concerned, who shall be given an opportunity to be heard.

Inaction by the NGA or GOCC on the said complaint within twenty (20) working days from the receipt of such complaint shall be deemed a dismissal of the complaint against the CSO involved.

SEC. 11. Non-Accredited CSOs. - Non-accredited CSOs shall still have the

option to participate in the budget process by submitting position papers for the consideration of the NGA or GOCC, and by attending and observing in any regular and consultative public meetings, hearings, conferences, and dialogues on matters related to the preparation and authorization of the annual national budget. If necessary, non- accredited CSOs may be invited to expound on their critique or proposals. Nothing in this Act shall be construed to deprive non-accredited CSOs the rights, privileges and incentives accorded to them by the Constitution, existing laws, executive orders, rules and regulations and other issuances.

SEC. 12. Public and Timely Disclosure of Budget Documents and Other

Related Data. - In order for CSOs to participate in an informed manner, the NGA or GOCC shall post on their websites or other public posting areas, budget documents to 16 which CSOs shall have access pursuant to Section 7 of this Act.

SEC. 14. Separability Clause. - If any portion or provision of this Act is

18 declared unconstitutional, the remainder hereof or any provisions not affected thereby shall remain in force and effect.

SEC. 15. Repealing Clause. - Any law, presidential decree or issuance,

executive order, letter of instruction, rule, or regulation inconsistent with the provisions of this Act is hereby repealed or modified accordingly.

SEC. 16. Effectivity. - This Act shall take effect fifteen (15) days after its

complete publication in the Official Gazette or in a newspaper of general circulation. Approved,