DBM-7 disallows P79.7 million from city’s annual budget

CEBU, Philippines — The Department of Budget and Management (DBM) in Central Visayas has disallowed P79.7 million from the P14.6 billion annual budget of the Cebu City government for 2025, following its review of the budget ordinance.

During the City Council’s session on Wednesday, the Cebu City Budget Office presented DBM-7’s official review of the recently passed budget. While the DBM confirmed that the budget ordinance was compliant with relevant laws, it identified disallowed appropriations totaling P79,705,000.

Among the flagged items was approximately P19.7 million in appropriations not listed in the Annual Investment Plan (AIP). This included a P100,000 allocation under the Civil Security Unit for “Other Supplies and Materials Expense,” a description not found in the city’s AIP.

Also disallowed were a P5.18 million appropriation for the Office of the City Accountant for an accounting system digitalization project, and P1 million for the “Operation Tuli” program under the Cebu City Health Department’s Field Services.

A P10 million allocation for the procurement of heavy equipment under the Department of Engineering and Public Works was similarly rejected due to its absence from the AIP.

In another case, the DBM flagged a P60 million appropriation under the City Health Department’s Field Services, noting that it exceeded the amount allocated in the approved AIP.

The review also cited numerical errors totaling P3,360,979.20, including P2,164,315.80 in excess appropriations for Personnel Services (PS) due to incorrect salary grades or job classifications.

“No official or employee shall be entitled to a salary rate higher than the maximum fixed for his position or other positions of equivalent rank by applicable laws or rules and regulations issued thereunder,” the DBM emphasized.

Additional disallowances included P48,663.40 in excess PhilHealth contributions and P1,148,000 in excess medical allowances.

The DBM further recommended a review of the city’s operating expenses, especially regarding salaries and plantilla positions. Suggestions included the reclassification or abolition of certain salary grades, as well as guidance on overtime pay, bonuses, and honoraria.

The agency urged the city government to revisit and finalize its AIP, highlighting that implementation schedules for the Cebu City Anti-Indecency and Tripartite Peace Industrial Council were still listed under fiscal year 2024.

“It is understood that this review does not authorize any item of appropriation that is specifically prohibited by or inconsistent with the provisions of law,” the DBM noted.

“Items of appropriations that are not included in the conditions mentioned above and are contrary to existing budgeting, accounting, and auditing rules and regulations shall not be allowed for disbursement,” it added.

The review was signed by Acting Director IV Maricor Baquial and dated March 19, 2025. – /FPL (FREEMAN)