State of the Nation Address

25 July 2022

President Ferdinand R. Marcos, Jr. delivered his first State of the Nation Address on 25
July 2022. While his veto of the OGCC Bill was not addressed directly, the priorities bared by the
President over the next six (6) years may be indicative of how he might act on a similar
proposal.

Notable policy points:

Policy How it may affect a future OGCC Bill
Economy
Expenditure priorities will be realigned, and This statement clearly lays the basis for the
spending efficiency will be improved to Marcos administration’s push for fiscal
immediately address the economic scarring prudence. Additional expenditure for the
arising from the effects of Covid-19, and also government, i.e., increased salaries and
to prepare for future shocks. benefits, will have to be justified in light of an
expected tightening/fastidiousness in
The Medium-Term Fiscal Strategy of this expenditures.
administration seeks to attain short-term
macro-fiscal stability while remaining Note that this is does not necessarily mean
supportive of the country’s economic that the government will be tightening its
recovery and to promote medium-term fiscal belts for the remainder of the Marcos
sustainability. Furthermore, and more administration. The key term here is
importantly, fiscal policy aims to bring sustainability. The OGCC Bill must fit the
together the National Government’s narrative of fiscal sustainability, while at the
resources so that these are mobilized and same time being responsive to the Marcos
utilized in order to gain the maximum benefit administration’s other key policy points, i.e.,
and the high multiplier effects for our rationalization of government services and
economy. the prioritization of Public Private
Partnerships (PPPs).
Legislative Agenda
The National Government Rightsizing This express directive from the President may
Program will entail a comprehensive strategic result in the OGCC’s purpose and functions
review of the functions, operations, being revisited, with fiscal prudence being
organization, systems and processes of the the overpowering consideration, as well as
different agencies, and massive and the streamlining processes, especially for
transformational initiatives in agencies PPPs. That it was the first proposed
concerned, such as mergers, consolidation, legislation mentioned by the President may
splitting, transfer, and even the abolition of indicate that this is of the highest priority. An
some offices. important point to consider is that the
President mentioned the possibility of
mergers, consolidations, and even abolition
of government agencies. Implementation of
rightsizing will be left by Congress with the

Budget Modernization Bill will institutionalize
the Cash-based Budgeting System (CBS)
under Executive Order No. 91, Series 2019 to
strengthen fiscal discipline in the allocation
and use of budget resources by ensuring that
every peso budgeted by the government
would lead to the actual delivery of programs
and projects.
E-government will provide for the
establishment of the E-Government Master
Plan which shall cover all e-government
services and processes
Amendments to the BOT Law will address the
bottlenecks and challenges affecting the
implementation of the Public-Private
Partnership (PPP) Program.
The President said PPPs hold great potential
for that expansion, for infrastructure
development and for innovation.
The President mentioned that PPPs will play
a part in support of developing new sources
as funding in this period is limited.
President, which makes effective
representations with the Executive an
imperative.
While directed at government projects, it
nonetheless highlights the government’s
thrust in fiscal prudence, which is a persistent
theme in the President’s agenda.
Extension of e-services may result in
government processes being less reliant on
human intervention. This goes hand-in-hand
with the rightsizing program, and could make
it difficult for government agencies to justify
additional funding if one of the purposes of
the program is to reduce government
expenditures through the utilization of
automated processes.
It appears that the Marcos administration
wants to further streamline processes
involving PPPs, which may result in the
removal of steps or procedures. OGCC’s role
in reviewing/approving PPP contracts, for
example, may be revisited.