1.

It involves the inflow of financial resources in the form of taxes

and other revenues, and the outflow of such resources in the
form of expenditure to finance goods and services. Refers to
the income and outgo of the governments in the pursuit of
national objectives.1. Public Finance
2.  Public Finance Cycle Formulation of fiscal policy A process
Generation of revenue Accountability from taxation and other
sources Expenditure of Public funds through borrowings the
national budget
3.  Public Finance The FORMULATION OF FISCAL POLICY lies at
the dead center of the democratic government. -E. Pendleton
Herring, 1938
4. Formulation of fiscal policy
5. Now a days, “FISCAL AND MONETARY POLICY” is used as a
single concept though it has a different aspect of economic
policy but have related impact. Fiscal policy refers to policies on
taxation, and other revenue, expenditure, and borrowings which
is intended to promote the stabilization and development of the
economy.FISCAL POLICY
6.   On the other hand, monetary policy is generally understood to
be that which influences the level of money supply in the
economy. Fiscal and monetary policy have been crafted in
response to requirements of stabilization, and subsequently, and
in accordance with the structural adjustment programs (SAPs)
negotiated by the International Monetary Fund (IMF).FISCAL
POLICY
7.   Things to ponder: i. As a PA scholars how we are going to
assist the government in reinventing fiscal and monetary policies
to cope with the drive towards social and economic
transformation? The formulation of fiscal and monetary policy
made a huge part of economic and social development but not
limited to socio-cultural and political.FISCAL POLICY
8.  Public Finance Cycle2. Generation of revenue from taxationand
other sources
9.   A tax is a compulsory contribution mandated by law and
exacted by the government for a public purpose. The major tax
collecting agencies of the national government are the Bureau of
Internal Revenue and the Bureau of Customs. Revenues refer
to all cash inflows of the national government treasury which are
collected to support government expenditures but do not
increase the liability of the NG.Generation of Revenue
10.  Non-tax revenues refer to all other impositions or
collections of the government in exchange for services rendered,
assets conveyed, penalties imposed, etc.Generation of
Revenue
11.   Taxes on income and profits are imposed on all taxable
income earned or received by a taxpayer, whether as an
individual, as a partnership, or as a corporation, during a
particular period of time, usually lasting one year. Taxes on
domestic goods and services are imposed on the use or sale of
locally manufactured goods as well as local services availed of
within the domestic territory.Generation of Revenue
12.   Other taxes primarily include collections from the motor
vehicles tax, immigration tax and forest charges. Taxes on
international trade and transactions include import and customs
duties, and other international trade-related collections of the
government. Taxes on property are imposed on the ownership of
wealth or immovable property levied at regular intervals and on
the transfer of real or personal property.Generation of Revenue
13.  MAJOR CLASSES OF Taxes on TAX REVENUES
Domestic Goods and Taxes on Taxes Services International on
Trade and Property Transactions Taxes on Other Income
Revenue Sources and Profits
14.   What are the governments current efforts to improve tax
collections? i. The national government has continuously
expended an all-out effort to strengthen its revenue-generating
capability through legislative and administrative reforms. ii.
Recently, the government came up with a comprehensive
measure to overhaul the tax system to bring in badly needed
revenues for the government. Called the Comprehensive Tax
Reform Program (CTRP), the new tax measure has three
principal components, namely, a) income tax reform; b) excise
tax reform; and, c)Generation of Revenue
15.   What are the governments current efforts to improve tax
collections? iii. The CTRP aims to widen the tax base, simplify
the tax structure to minimize leakages, undeclared revenues,
overstated deductions and corruption to make the system more
elastic and easier to administer.Generation of Revenue
16.  Public Finance Cycle3. Expenditure of Funds throughthe
National Budget
17.   The principal activities of government are normally
controlled A budget is a plan of financial operation composed of
estimate or proposed expenditure for a given period or purposed
and the proposed means of financing them.Expenditure of
Funds - NationalBudget
18.  Expenditure of Funds - National BudgetPHASES
ONBUDGETARYPROCEDURES
19.  Budgetary Procedures:1. Preparation and Presentation•
This phase covers the estimation, determination and translation
of government revenues, priorities and activities.• Government
entities prepare their budgets for the year to be submitted to the
 Department of Budget and Management (DBM) for review.• The
DBM then consolidate all budgets to form a government wide
budgeting estimate, The “National Budget”.• This shall be
submitted to the president for final approval.
20.  Budgetary Procedures:2. Budget Authorization
andLegislation• Involves the submission of the national
government budget to the legislative body for review,
deliberation, and formulation of an appropriation bill to be
forwarded to the president for approval and signature.
21.  Budgetary Procedures:3. Budget Execution and Operation•
Covers the implementation of the various operational aspect of
the budget.• Such as release of allotments to the various
agencies, the continuing review of the fiscal position, and other
related activities.
22.  Budgetary Procedures:4. Budget Accountability• Involves
the evaluation of expenditures and performance against the
predetermined budget.• Obligation incurred, personnel used and
work accomplished are compared with the plans and goals of
various agencies submitted at the time their respective budget is
prepared.
23.  Budgetary Procedures:4. Budget Accountability•
Accomplished by the heads of the various agencies who review
the performance of their respective agency;• And the
Commission on Audit (COA) who examines the operations of the
agency.

(Reference : http://www.dbm.gov.ph/dbm_publications) The

premised on a revenue assumption of 15.6 percent or in
absolute terms, P1.410 trillion the Development Budget
Coordinating Committee (DBCC’s) recommendation of the
budget for 2011 which has gone down from what was originally
proposed which was P1.757 trillion then; President Noynoy
Aquino has approved a budget of P1.645 trillion for 2011. 6.7
percent higher than 2010 Budget. 2011 National Budget
24. (Reference : http://www.dbm.gov.ph/dbm_publications)
The Department of Education has been allocated P207.3 billion;
Public Works and Highways, P110.6 billion; and National
Defense has been allocated P104.7 billion. Interior and Local
Government get P88.2 billion; Agriculture, P37.7 billion; Social
Welfare and Development, P34.3 billion; Health, P33.3 billion;
Transportation and Communications, P32.3 billion; Agrarian
Reform, P16.7 billion; and Justice, P14.3 billion.2011 National
Budget
25. 400 200 0 Department of… Public Works… Agriculture
Social Welfare… Health Transportatio…Agrarian ReformSource:
 2011 National Budget Allocation
Justicehttp://www.dbm.gov.ph/dbm_publications
26.   Presidential Decree No. 1177 (PD 1177) which prescribes
the budget process and provides for the automatic appropriation
of, among other things, the debt service. This decree,
promulgated by the late President Ferdinand E. Marcos during
his autocratic regime and continue to dictates fiscal processes
even under the present democratic system.2011 National
Budget
27.   Pnoy Administration continue to adopt measures to further
bring down the expenditure as well as the deficit level. i. tighter
allocations for government-owned and controlled corporations; ii.
limits in the increases for utility, communications and supply
expenditures; iii. a ban on the construction of new office
buildings except classrooms and public health centers; iv. a ban
on the acquisition of motor vehicles; v. a ban on new positions
except those for teachers and uniformed and medical personnel;
vi. and keeping contractual and casual employee levels2011
National Budget
28.   Government revenues are expected to reach P1.41 trillion ,
with P940 billion coming from the Bureau of Internal Revenue
(BIR), P320 billion from the Bureau of Customs (BOC), P6 billion
from privatization and P144 billion from other revenue-generating
agencies. Deficit is expected to reach P290 billion or 3.2 percent
of GDP.2011 National Budget
29.  Privatization 2011 Nat’l BOC 320B 6B BudgetBIR 940B
Others 144B Expect ed 1.41 T Approved Budget Expected
Deficit 290B 1.645T or 3.2 GDP
30. Public Finance Cycle4. Public Borrowings
31.   Borrowings refer to funds obtained from repayable
sources, such as loans secured by the government from financial
institutions and other sources, both domestic and foreign, to
finance various government projects and activities.Public
Borrowings
32.   The government borrows from any of the following
reasons: i. to finance national government deficits; ii. to obtain
foreign exchange; iii. to secure financing at more favorable terms
than the opportunity cost of revenues; iv. to take advantage of
benefits attached to the funds, e.g. technology; and, v. to
balance the timing of resources with thePublic Borrowings
33.   Cited the following indicators; i. Total debt stock as a
percentage of GNP and as a percentage of exports has been
reduce. ii. The share of concessional debt to total debt stock had
increased iii. Foreign exchange reserves have reached a
comfortable level. Government claims that debt crises is
 already over in the Philippines.  Is the debt crises over?
Public Borrowings
34.  But as to the point of economist, they noted that it maybe
true that debt as a foreign exchange problem is becoming
manageable. Debt issue remains a fiscal policy problem, in view
of the fact that debt payment continue to be a terrible burden of
the budget. Is the debt crises over? Public Borrowings
35.   The country debt to Japan is growing rapidly now so much
because of new loans but because of revaluation. Right now,
Japan is our No. 1 Bilateral creditor. Nearly 70% of the total
official debt is owned to Japan.Public Borrowings
36.   It consists of all claims against the government which may
be payable in goods and services, but usually in cash, to foreign
governments or individuals or to persons natural or juridical.
Public debt includes obligations incurred by the government and
all its branches, agencies and instrumentalities, including those
of government monetary institutions.Public Borrowings
37.   Obligations maybe: i. 1) purely financial, i.e., loans or
advances extended to the Philippine government, its branches,
agencies and instrumentalities; ii. 2) services rendered or goods
delivered to the government for which certificates, notes or other
evidence of indebtedness have been issued to the creditor; and
iii. 3) for external debt such as claims of foreign entities,
securities held in trust, nonbonded debts and obligations of the
Philippine government toPublic Borrowings
38.  Public Finance Cycle5. Accountability
39.   The political-administrative continuum means that elected
officials are politically accountable to the electorate or their
constituencies who voted them to their positions. These elected
officials are held responsible thru regular elections and other
means, i.e. recall and referendum. Appointive public officials
answer to the people thru the elected officials who appointed
them and directly to the public.
Accountability is defined as a condition in which individuals who
exercise power are constrained by external means and by
internal norms. It refers to the institution of checks and balances
in an organization thru which an administrator accounts for his
stewardship of resources or authority.Accountability
40.   Types of Accountability i. Individual accountability – public
employees are answerable for the responsible, efficient and
effective performance of their tasks. ii. Accountability of
administrators – for their stewardship of the administrative
authority, resources and information placed at their disposal as
leaders ofAccountability
41. Types of Accountability
iii. Political accountability – of institutions that must answer for
their organizational mandate and functions, particularly as they
form part of the incumbent government strategy for national
development.
iv. Accountability of national leaders – elected national
leadership must answer for the performance in pursuing their
programs of government and their use of national resources,
given the authority, power andAccountability
42. Philippine Administrative Structure i. Constitutional bodies:
1) constitutional commissions - CSC, COA, COMELEC; 2)
constitutionally created/mandated special bodies – CHR and
Ombudsman ii. Executive Departments iii. GOCCs (wholly-
owned or at least 51%) iv. Chartered institutions (created by law)
v. LGUsAccountability
43. 44. http://www.dbm.gov.ph/dbm_publicationshttp://
www.nscb.gov.ph/secstat/d_finance.asp Advance Accounting –
Government Accounting System for NationalGovernment
Agencies: 2011 Edition By P. GuerreroPhilippine Administrative
System (PAS) : Ma. Concepcion P.Alfiler, UP Open UPA in the
Philippines: A Reader 2nd Edition (UPNCPAG)References:
44. 45. A Process on Public Finance CycleReported by:
Sherwin M. ArcipeLNU Dagupan City Prof. Jo B. Bitonio, DPA