City Council okays P6.29B budget

Cebu City GAA FOR 2018

After a series of deliberations, the Cebu City Council has finally approved the P6.29-billion annual budget for 2018 proposed by Mayor Tomas Osmeña.

There were hardly any changes made from Osmeña’s proposal except for the P55-million earmarked for relief and recovery operations under the Local Disaster Risk Reduction and Management Fund (LDRRMF) which was reduced by the council’s committee on budget and finance and reprogrammed for other expenses.

Councilor Margarita Osmeña, head of the committee on budget and finance, read the committee’s six-page report outlining details of the 2018 budget compared to this year’s annual budget.

After Councilor Osmeña’s report, the City Council then approved the budget ordinance with no significant discussions from other councilors.

According to the committee report, the P55-million LDRRMF budget for relief and recovery was reduced to only P30 million after a proposal to give P9,000 as rental subsidy for fire victims in the city was removed.

This after Cebu City Disaster Risk Reduction and Management Office (CCDRRMO) head Nagiel Bañacia failed to convince the finance committee during budget hearings of the subsidy’s viability considering that the city has already been extending P20,000 in financial aid to qualified fire victims.

But since the council cannot change the mandated 5 percent appropriation for LDRRMF, the P25 million reduction was reprogrammed for other uses.

An additional P15 million was placed for Public Safety and DRRM (Disaster Risk Reduction and Management) Program Base Services for the Quick Response Team for Drainage; while P106,500 was added to the EMS (Emergency Medical Services), Health Services, Medical Supplies and Materials.

Another P3.5 million was added for the procurement of life-saving medical equipment such as cardiac monitors for all city ambulances, P5 million to the City-Wide Early Warning System proposal; and P1.39 million was added to the Recovery and Rehabilitation Infrastructure account.

The P6.29-billion budget for 2018 is almost a billion pesos lower than the approved budget for 2017 which was P7.2 billion.

The Local Finance Committee (LFC) explained that the reduction was done in order to make the budget proposal “realistic and achievable” pointing out that in previous years, the City Treasurer’s Office (CTO) failed to reach the estimated revenues to fund the city’s budget.

Compared to this year’s P4.4 billion estimated total tax revenues, the estimated tax collection for next year has been pegged at P3.1 billion which includes P1 billion from real property taxes (RPT), P1.75 billion from business taxes and P359 million from other local taxes.

The estimated business tax revenue of P1.75 billion for 2018 is higher than the P1.5 billion expected for 2017 since the LFC anticipates the amendment of the Local Tax Code next year.

Aside from tax revenues, other sources of funds for next year include P947 million in non-tax revenues and P2 billion from external sources.

The 2018 annual budget is divided into personal services (P1.48 billion), maintenance and other operating expenses (P4.5 billion), and capital outlay (P119.6 million).

Smooth process

Compared to previous years, this year’s budget process went on more smoothly since it was also the first time in many years for the head of the council’s committee on budget and finance to be allied with the sitting mayor.

The mayor’s proposed annual budget was tackled by the council last October 24 and referred to the committee on budget and finance.

Immediately a day after, last October 25, the committee began a series of budget hearings which continued last October 27 and October 30.

About a week after the last hearing, the budget committee entered its report and final budget ordinance on the council session agenda yesterday, Tuesday.

The budget was approved.

According to Councilor Osmeña, the proposed budget sailed smoothly in session because of meetings conducted earlier between the Local Finance Committee and some city councilors to thresh out matters.

She also said that there were barely any changes made in the 2018 budget proposal from the city’s approved budget for 2017.

Changes

Notable changes in the budget for next year include an increase in the total allocation for personal services pegged at P420.1 million due to step increments in the salary grade of some personnel, as well as the release of the second tranche of mandated salary adjustments for 2018 under the Salary Standardization Law.

At the same time, compared to the 2017 budget, there was a drop in some financial assistance accounts for next year including the city’s scholarship program, senior citizens program, financial assistance to the Association of Barangay Councils (ABC), financial assistance to the Barangay Councilors League of the Philippines (BCLP), financial assistance to the League of Lupong Tagapamayapa, Persons with Disabilities (PWD) program, aid to city barangays, and incentive allowance for policemen serving Cebu City.

“The budget for the above mentioned programs is only good for half of the year. The budget for the second half would be submitted by the Executive Department in a Supplemental Budget next year,” the finance committee report read.

Other notable points in the approved budget for 2018 are: an increase in the mayor’s discretionary fund from P7.4 million to P7.8 million based on the two percent actual real property tax collection in the preceding year, and a raise in the teachers’ assistance program from P56 million to P65 million due to the increased number of teachers next year.

Another P60,000 was also added to the Office of the Civil Registrar for its Civil Registration Month activities.

The committee noted new items in next year’s budget including P7 million for the purchase of fire extinguishers under the Peace and Order Program (POP); and P50 million for land improvements and the planned construction of a medium-rise building to be used as a relocation area.