Thursday, December 30, 2010

Commentary: General Appropriations Acts of 2010 and 2011 shows many new infrastructure projects were funded for U.P. in 2010 but without corresponding operating funds for 2011 and beyond

By Chanda Shahani

The 2010 General Appropriations Act which we have embedded below from the Department of Budget and Management (DBM) website shows that many important projects for the University of the Philippines (U.P.) were funded by the national government headed by the administration of former President Gloria Macapagal-Arroyo.

President Benigno S. Aquino III has just signed into law the General Appropriations Act of 2011; but there has been zero allotments for new capital outlays for U.P. and for other State Universities and Colleges (SUCs).

The basic problem in U.P.'s and other government entity budgets for third party observers (such as ourselves, other bloggers, concerned citizens, NGOs etcetera) is the lack of detail in public documents which allow us to do some basic analysis for our readers.

The Diliman Diary subscribes to basic Hegelian dialectics which takes into account opposing points of view in order to arrive at a richer, more meaningful interpretation of the truth; mindful of the fact that any such insights may be later overthrown by new information and analysis. While we do take a stand on issues, we find it unacceptable not to take other sides into consideration because to do so would be for us to degenerate into mere propagandists.

(To zoom in on the graphics, just click on them)

Opponents of the SUC budget cuts say that the deterioration of the peso in real terms plus the hidden costs associated with inflation virtually guarantee that any claims to a slight increase in budget to SUCs are without significant merit and only constitute a token or symbolic increase.

But what is perhaps understated or underplayed is the sustainability of newly started U.P. programs and projects which have had the funding pulled out from under their own feet by the national government through the recommendation of the Department of Budget and Management, as DBM did not recommend further capital outlays for SUCs in 2011.

Some of the significant capital outlays for U.P. in 2010 which were given funding were:
  • Construction of the College of Business Administration Building: PhP 50 million
  • Construction of Academic Building, Clark University Town: PhP 50 million
  • School of Health and Science Extension Campus in Aurora Province: PhP 79.325 million
  • Construction of the U.P. Manila Centennial Building - Phase I: PhP 150 million
  • Engineering Research and Development for Technology Projects: PhP 275 million
  • Consturction of the U.P. Sports Center: PhP 500 million
The basic problem, however is that assuming these projects are all finished on time and within budget, there also need to be additional Maintenance and Other Operating Expenses (MOOE) to operationalize these new projects, as can be seen by the National Expenditure Program of the U.P. System which is posted on DBM's website (, and there has been no additional allocations for these new projects in 2011. Moreover, the National Government has sent out clear signals that the U.P. System has to already shoulder a bigger share of its existing budget which leaves these new projects in danger of becoming white elephants unless additional funding can be sourced from either the National Government or through U.P.'s own capabilities to generate additional revenues.

Unfortunately, the controversy-ridden administration of outgoing U.P. President Emerlinda R. Roman and her cabal of has failed to communicate U.P.'s legitimate needs for an increase in its budget to the new administration of President Benigno S. Aquino III. It is really up to incoming U.P. President Alfredo E. Pascual, whose term begins on February11, 2011 to make the case for an increase in U.P.'s budget to the administration of President Aquino stressing U.P.'s historic and future role in national development while at the same time making good on promises of financial transparency, accountability and democratic governance so that the regard for U.P. as the indispensable national university will remain undiminished.

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