Philippines digitises public financial management under Executive Order 29

President Ferdinand R. Marcos Jr., of the Philippines, has signed into effect Executive Order (EO) 29, a directive calling on all government bodies to adopt an integrated financial management information system (IFMIS) to handle their transactions. This sweeping order spans all departments, agencies, and instrumentalities of the national government, including government-owned or -controlled corporations (GOCCs), with the aim to solidify the integration of public financial management information systems and to expedite processes.

In a significant stride towards the digital future, EO 29 also extends to all local government units (LGUs), encouraging the implementation of an IFMIS for their transactions. This represents a concrete step towards the complete digitisation of public financial management (PFM) processes via the IFMIS.

“The Administration is committed to improving bureaucratic efficiency by capitalising on digitalisation efforts to ensure fast and efficient delivery of services to the public,” EO 29 states. It adds that the continuous development and application of IFMIS would result in heightened financial management and control of oversight and government agencies.

Moreover, EO 29 emphasises that the wholehearted acceptance of IFMIS would ensure stern compliance with current appropriations laws, rules, and regulations. It would also enhance treasury cash management, facilitate the generation of financial reports, and simplify reportorial requirements at various government levels.

Under EO 29, the existing PFM Committee, formed by virtue of EO 55 in 2011, is directed to reengineer PFM processes and the IFMIS. Comprising representatives from the Department of Budget and Management, Department of Finance, Commission on Audit, and the Bureau of Treasury, the Committee is charged with policy and process review of key PFM processes, including budget management and execution, cash management, and accounting and reporting. Their mandate is to pinpoint and address bottlenecks, and update corresponding policies.

The committee is also obliged to reengineer PFM processes and maximise the use of financial systems to ensure smooth government transactions. Part of their remit is the creation of a strategic plan through the development of a PFM Reforms Roadmap, aimed at hastening the development of IFMIS while ensuring a harmonious policy across oversight agencies.

EO 29 broadens the PFM Committee’s responsibilities, which now include conducting comprehensive mid-term reviews of the PFM Reforms Roadmap implementation and submitting detailed annual reports on all project milestones, findings, and recommendations to the Office of the President.

The Department of Information and Communications Technology has been instructed by EO 29 to provide technical and policy support in the development and execution of the IFMIS.

In terms of funding, the initial requirements for the full implementation of IFMIS will be charged against the respective appropriations of national government agencies and the corporate operating budgets of GOCCs. Meanwhile, future funding needs for the ongoing execution of EO 29 will be incorporated into the budget proposals of the covered agencies.

EO 29 was issued based on the recommendations made by the Private Sector Advisory Council for the Digital Infrastructure group to help foster efficiency, transparency and ease of doing business with the government. This decisive move by President Marcos represents a significant step towards a digital future, showcasing the Philippines’ commitment to embrace modern technology for public financial management.