NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
SENATE 
S. No. 1
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Introduced by Senator PIA S. CAYETANO
AN ACT
PROVIDING A FRAMEWORK FOR SUSTAINABILITY-BASED BUDGETING
EXPLANATORY NOTE
The Philippines adopted AmBisyon Natin 2040, which represents the collective 
long-term vision and aspirations of the Filipino people for themselves and for the 
country.
As a party to the United Nations 2030 Agenda for Sustainable Development, 
the Philippines is committed to the achievement of the seventeen (17) Sustainable 
Development Goals (SDGs). The SDGs are a universal call to action to end poverty, 
promote inclusiveness, build peaceful societies, and protect the planet. They are an 
integration of the three dimensions of sustainable development: economic, social, and 
environmental.
However, disasters and unforeseen events, such as the COVID-19 pandemic, 
hinder our achievement of these goals and aspirations. As of the first half of 2021, the 
number of impoverished Filipinos surged to 26.14 million.1 The report on the Futures 
of Education by the Committee on Sustainable Development Goals, Innovation, and 
Futures Thinking, which was adopted by the Senate in the 18th Congress, also found 
that addressing issues on education such as the lack of classrooms and other facilities.
1 Caraballo, M.U. (2021, December 18). Number of poor Pinoys surge to 26M. Retrieved from
https://www.manilatimes.net/2021/12/17/news/number-of-poor-filipinos-up-26m-in-mid-2021-
psa/1826303.


including access to technology, shortage of quality school textbooks and equipment, 
and the need to improve teacher quality, among others, will lead to graduates who 
are more competitive in the global workplace, and bring the country towards its most 
desirable future. Meanwhile, providing quality, accessible, and affordable healthcare 
for all Filipinos should remain a priority. It is important to act on these and many other 
issues as they can only be aggravated by the effects of climate change, which has 
been described as a "'crisis multiplier'that has profound implications for international 
peace and stability"2 and "the most systemic threat to humankind".3
The deliberations on national and local budgets and the use of public funds 
should be done with sustainability in mind and should be considered as an important 
tool for achieving sustainable development. Sustainability or sustainable development 
is defined as development that meets the needs of the present without compromising 
the ability of future generations to meet their own needs.
Currently, the annual budget process that Congress and local governments go 
through does not have any mechanism to establish and later monitor the sustainability 
of public spending and investments. Now more than ever, it is important for decision­
makers and the public to know the effects of the national and local budgets on 
sustainable development given our limited resources and how this can impact future 
generations.
Recognizing our long-term goals and vision for the country and acknowledging 
the urgency to address the threats against them, it is imperative to ensure that 
national and local appropriations are aligned with the objectives of sustainable 
development. This can be done by taking an approach to the budget process that 
prioritizes sustainability in resource allocation and ensuring that budget 
implementation moves the country towards sustainable development.
2 United Nations Security Council. (2021, February 23). Climate change 'biggest threat modern humans 
have ever faced', world-renowned naturalist tells security council, calls for greater global cooperation. 
https://www.un.org/press/en/2021/scl4445.doc.htm
3 Somini, S. (2018, March 29). Biggest threat to humanity? Climate change, U.N. chief says. The New 
York Times, https://www.nytimes.com/2018/03/29/dimate/united-nations-climate-change.html


This measure, thus, seeks to create a framework for sustainability-based 
budgeting to be used during the preparation and monitoring phases of national and 
local government budgets. The Framework shall have components that ensure 
sustainable development is at the forefront of the budget process, such as the use of 
tools and methodologies for evidence-based decision-making, defined roles and 
responsibilities and timelines, and an emphasis on transparency and accountability. 
The Framework shall also include various aspects of sustainable development based 
on the SDGs and other priorities and goals of the national and local governments 
related to sustainability.
This bill is based on existing guidelines on sustainable financing by the 
Department of Finance and green budgeting principles from the Organization for 
Economic Co-operation and Development and the European Union.
In view of the foregoing, the approval of this bill is earnestly sought.
PIA S. CAY/CTANO


NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
SENATE
S. No. 1 3
Introduced by Senator PIA S. CAYETANO
AN ACT
PROVIDING A FRAMEWORK FOR SUSTAINABILITY-BASED BUDGETING
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
1 
Section 1. Short Tide. - This Act shall be known as the 'Sustainable Budgeting
2 
Act"
3 
Sec. 2. Declaration of Policy. - The 1987 Constitution mandates the State to
4 
protect and advance the right of the people to a balanced and healthful ecology in
5 
accord with the rhythm and harmony of nature.
6 
The State also remains committed to achieving AmBisyon Natin 2040, which
7 
represents the long-term vision and aspirations of the Filipino people for themselves
8 
and for the country, and remains as a guide for the future and the anchor of the
9 
country's plans.
10 
As a party to the United Nations 2030 Agenda for Sustainable Development,
11 
the State upholds its commitment to the seventeen (17) Sustainable Development
12 
Goals (SDGs), and to achieving sustainable development in its economic, social and
13 
environmental dimensions in a balanced and integrated manner.
14 
The State also affirms its commitment to the United Nations Framework
15 
Convention on Climate Change in the stabilization of greenhouse gas concentrations
16 
in the atmosphere at a level that prevents dangerous anthropogenic interference with
17 
the climate system, achievable within a time frame sufficient to allow the natural
18 
adaptation of the ecosystem to climate change, to ensure food production and food
19 
security, and to secure sustainable economic development. Further, the State remains
1


1 
committed to the 2015 Paris Agreement, which includes making finance flows
2 
consistent with a pathway towards low greenhouse gas emissions and climate-resilient
3 
development.
4 
The State also recognizes the urgency of climate change (SDG 13) and the
5 
need to consider investments addressing the same, and the imperative to transform
6 
into a more sustainable and environmentally mindful society, and move towards a low
7 
carbon economy which uses all resources to their fullest extent while creating
8 
opportunities for investments, growth, and employment.
9 
It shall, therefore, be the policy of the State to establish a framework for
10 
sustainability-based budgeting, which shall be used during the annual preparations for
11 
both national and local appropriations. Incorporating sustainability into the budgetary
12 
process shall make both the national and local governments more accountable to their
13 
commitments towards sustainable development and support their transformation into
14 
sustainable and resilient communities.
15 
Sec. 3. Definition of Terms. - For purposes of this Act, these terms are defined
16 
as follows:
17 
(a) Sustainabiiity or sustainable development refers to development that
18 
meets the needs of the present without compromising the ability of
19 
future generations to meet their own needs.
20 
(b) Sustainabiiity-based budgeting refers to the budgetary process and
21 
policymaking that helps achieve sustainable development. This includes
22 
evaluating the sustainability impacts of budgetary and fiscal policies and
23 
assessing their coherence towards the delivery of national and
24 
international commitments towards sustainable development. It can also
25 
contribute to informed, evidence-based debate and discussion on
26 
sustainable growth.
27 
Sec. 4. Sustainability-Based Budgeting Framework. - The Development Budget
28 
Coordination Committee (DBCC), in coordination with relevant government agencies,
29 
shall develop a framework for sustainability-based budgeting, which shall include the
30 
components stipulated under Section 5 of this Act.
31 
The Framework shall provide guidance for the national and local governments
32 
in their budgetary process and policymaking in ensuring that resource allocation takes


1 
into account the sustainability of resources, environmental impacts and the interests
2 
of future generations. Further, the Framework shall help redirect public investment
3 
and consumption towards more sustainable priorities and practices and away from
4 
harmful subsidies.
5 
Sec. 5. Components of Sustainability-Based Budgeting. - The Sustainability-
6 
Based Budgeting Framework shall have the following components:
7 
(a) Alignment with national and local development plans and strategic
8 
priorities and goals. - Sustainability-based budgeting should encompass
9 
various aspects of sustainable development based on the SDGs and
10 
other priorities and goals related to sustainability, as may be applicable
11 
to the national and local governments. This includes but is not limited to
12 
land and water preservation, waste management, climate mitigation and
13 
adaptation, development of quality, reliable, sustainable and resilient
14 
infrastructure, and shifting to sustainable practices and the use of
15 
innovations that promote sustainability.
16 
Budgetary items both favorable and unfavorable to sustainable
17 
development should be tagged accordingly to provide a comprehensive
18 
picture on how the national and local budgets contribute to
19 
sustainability.
20 
(b) Use of tools and methodologies that contribute to evidence-based
21 
decision-making and policy coherence. - Sustainability-based budgeting
22 
shall promote the use of tools and methodologies that produce relevant,
23 
accurate and timely data and evidence to guide decision-making in the
24 
budget process. Such tools and methodologies should likewise
25 
strengthen monitoring, reporting and accountability.
26 
The Framework shall also provide methods for determining, as far
27 
as practicable, the budget execution's impact on sustainable
28 
development.
29 
These tools can include but shall not be limited to budget tagging,
30 
environmental impact assessments, modeling and forecasting, spending
31 
review and performance setting with a perspective on sustainability.


1 
(c) Inclusion of clearly-defined responsibilities and a timeline for actions. -
2 
The Framework shall provide clearly defined roles and responsibilities for
3 
relevant agencies to ensure the objectives of sustainable development
4 
and sustainability-based budgeting are met, and that the required
5 
human and administrative resources are allocated. Close collaboration
6 
and coordination among all agencies and stakeholders to ensure the
7 
timeline of objectives are met shall be encouraged.
8 
(d) Use of transparent reporting and independent oversight to ensure
9 
openness and accountability. - The Framework shall provide measures
10 
for openness and accountability to ensure the accuracy of budgetary
11 
assessments in attaining sustainable development. This includes citizens'
12 
participation in the budget process.
13 
Sec. 6. Separability Clause. - If any provision of this Act is declared
14 
unconstitutional or otherwise invalid, the validity of the other provisions shall not be
15 
affected thereby.
16 
Sec. 7. Repealing Clause. - All laws, decrees, orders, rules and regulations or
17 
parts thereof inconsistent with this Act are hereby repealed or modified accordingly.
18 
Sec. 8. Effectivity. - This Act shall take effect after fifteen (15) days from its
19 
publication in the Official Gazette ox in a newspaper of general circulation.
Approved,