Transparency cuts both ways
For the first time in the history of Congress, its deliberations on the national budget would be made open to the public this year.
Twelve civil society organizations would be “nonvoting observers” in the discussion of the proposed P6.793 trillion 2026 National Expenditure Program, which includes the bicameral conference committee that irons out any differences in the appropriations bills approved by the two chambers.
The Senate is going one step further. It would make public the names of senators who propose changes or amendments to the appropriations bill and their reason for doing that.
The unprecedented action aims to restore public trust in the budgetary process that, last year, was hit by allegations of corruption and clandestine insertions that served the interests of select lawmakers.
This effort at transparency on the manner by which taxpayers’ money is being allocated assume significance in light of the present tight economic situation and the need for the government to meet the requirements of essential public services.
Better late than never, but it is gratifying that the government is (at last!) applying to itself the rules on transparency it demands or requires of companies listed on the Philippine Stock Exchange (PSE) and public companies, i.e., those with assets of at least P50 million and have 200 or more stockholders, at least 2000 of which are holding at least 100 shares, that issue securities.
These companies are required, under pain of hefty fines and in the case of listed companies, delisting, if they fail to timely comply with the reportorial or disclosure requirements of the PSE or the Securities and Exchange Commission (SEC).
The rationale for this requirement is simple.
Since these companies solicit or receive funds from the public (or third party investors), it is reasonable to demand that they be transparent or open about their operations so investors can make well thought of decisions on whether to continue to keep their investments or pull them out based on their reading and appreciation of the information disclosed in the reports.
Any material information that may influence that decision would have to be reported within specific time frames using a prescribed format.
And the good thing is, investors have easy access to them through the companies’ websites that are required by the SEC to be updated promptly upon receipt of those reports.
For listed companies, no information is trivial or too small a matter to be reported as long as it may have a bearing, directly or indirectly, on the investors’ decision on the management of their investments.
For example, since one of the motivating factors for investment is the investor’s trust and confidence in the competence of the company’s top echelon, the “resignation or removal of directors, officers or senior management and their replacements and the reasons for such” has to be promptly disclosed.
Note that the money involved in these investments is primarily private in character, although some government financial institutions engage in it to get good returns on the funds they hold in trust for their stakeholders.
But despite the limited scope and nature of those investments, the law imposes strict rules on transparency to protect the interests of the investors, so much so that some companies employ staff primarily to ensure compliance with that obligation.
What more if the funds involved are sourced from taxpayers whose wages are deducted taxes even before they get hold of the money they worked for?
When taxpayers’ money is involved, the obligation to be more responsible and prudent in their disposition is critical.
Verily, transparency cuts both ways and more so for the government.
So, fingers crossed, the announced policy on transparency in the deliberations on the national budget may result in the meaningful allocation of precious public funds.
But going by past efforts to make the legislative process more responsive to the people’s needs, that may very well be a pipe dream.
