THE CORE IDEA behind the Disbursement Acceleration Program (DAP) bears less on the legal or the constitutional than on the pursuit of good governance. It is ironic to see that the life of the program must end upon the behest of people who profess to pursue the same
The difference is in the eye, in the manner of a writer who said: “The real voyage of discovery consists not in seeking new lands, but in seeing with new eyes.” Except that the “new eyes” are not exactly new in the chronological sense, but only in relation to the antiquity of the old.
The new governance practices, as set against the backdrop of the old, are documented by authors David Osborne and Ted Gaebler in Reinventing Government: How the Entrepreneurial Spirit Is Transforming the Public Sector, published 22 years ago. Amid the legalisms that have marked the discussions on the DAP, pulling out the book from the box for another re-read was worth the while.
I wasn’t surprised to find cases cited in the book that resemble DAP-like features and the budget reforms introduced under the PNoy administration. The DAP was conceived to allow the President enough space to free up and move resources from items where they are less needed into those where they are most needed, when they are needed. The mechanisms mirror an assumed need: managerial discretion and flexibility.
Why is it a need, in the first place: you have your budget, anyway, which is just another word for “financial plan”? A good plan in place would minimize your need for discretion and flexibility.
The point, however, is you can only plan so much — for some fundamental reasons that rest on the very nature of things. First, humans live in a complex, dynamic world that moves ceaselessly in “chaotic” fashion. The rule is, the farther you project your plan into the future, the less accurate you get about your assumptions. Planning is an exercise in making assumptions.
If you complain about the accuracy of daily weather forecasting, you have more reason to rail against the accuracy of a financial plan that projects itself a year ahead into the future — and you’re doing so in a densely networked “techno-social” system that is tremendously more complex, more sensitive to initial change than the weather system.
And second, humans themselves are a complex lot. The age-old paradigm of human rationality has been withering on the vine with the growth of a new paradigm that sees human thinking as a function of reason and emotion, of cognition and intuition. Nobel prize awardee Daniel Kahneman points to how this new finding shows itself in the everyday behavior of people by way of, say, heuristics and biases. And some of these yield something relevant to our point — the “planning fallacy.”
People and organizations tend to “underestimate the time, costs and risks of future actions and at the same time overestimate the benefits of the same actions.” It serves to explain time and cost overruns and output or outcome shortfalls. To err is human.
It’s not for a facetious reason, therefore, that planning is called by one economics professor as the “science of muddling through.”
Against these powerful forces, humans are not exactly helpless. For one, we can set up measures that reduce the risk of erring and mitigate the damage from erring.
The details needed in line item budgeting increase the risk of erring; it requires a high degree of clairvoyance to see the details one year ahead of time. That’s why facetiously I propose a corollary to the planning fallacy, which states: “Your understanding of the complexity of nature and humans stands in inverse relation to the degree of detail you demand of the budget.”
Line item budgeting, wrote Osborne and Gaebler, “was originally done to control the bureaucrats — to hem them in on all sides, so they could not spend one penny more than the council or legislature mandated on each item of government. But once again, our attempt to prevent bad management made good management impossible.”
Having a line item budget already in place (although reform in this area has also been under way), our option is to mitigate the damage from mistakes. If you earmarked one billion pesos for Item A in the budget, whose implementation slowed down or stopped altogether halfway through the budget year, leaving a balance of half-a-billion pesos, what do you do with the balance?
The Supreme Court (SC) said, leave the money alone! The law said they are not “savings”: even if they are, you can only use them after the end of this year.
The DAP held that government money that’s left unspent is half-billion pesos worth of services denied the people for the remaining half of the year. It proposed to use them for better-performing items right away.
The SC, in fairness, discussed lengthily in the ponencia the crucial importance to management of discretion and flexibility, and ended up citing an American constitutional scholar as saying: “Were Congress to control expenditures by confining administrators to narrow statutory details, it would perhaps protect its power of the purse but it would not protect the purse itself. The realities and complexities of public policy require executive discretion for the sound management of public funds.”
How then could the justices decide in the way they did? Legalism. One famous psychologist offers the well-known metaphor: “I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail.”
Mario M. Galang is a senior fellow of Action for Economic Reforms and a development and governance specialist.