This Circular is being issued to provide guidelines in the release of funds to agencies pending congressional approval of the FY 1997 budget.


The provisions of this Circular shall apply to the following:

-        National Government Agencies, including those with fiscal autonomy and Integrated Area Development Projects (IAD);

-        Government Owned and Controlled Corporations; and

-        LGUs receiving Internal Revenue Allotment (IRA)


3.1       Release of Allotment

a.      The GARO issued by DBM to all agencies including those with fiscal autonomy and Integrated Area Development Projects (IADs) is based on the FY 1996 budget and covers the following:

-      25% of the total Personal Services (PS) and Maintenance and Other Operating Expenses (MOOE) requirements of regular programs appropriated in agency budgets under RA 8174 (including salaries of casual and contractual personnel) and salary adjustments for 1996 funded out of the Compensation Adjustment Fund; and,

-      25% of the total PS, MOOE and Capital Outlay requirements of on-going projects, both locally-funded and foreign-assisted, but not to exceed 25% of the amount proposed under the FY 1997 National Expenditure Program for the same project.

b.      The GARO released to LGUs represents 100% of the Internal Revenue Allotment (IRA) under RA 8174 based on the latest certified statistics on population, area and number of cities, provinces, municipalities and barangays.

c.       Separate GARO shall be released for the increase in IRA and for the implementation of the Salary Standardization II (SSL II).

d.      The following are not covered by GARO release:

-      Congressional Initiatives;

-      Completing projects in 1996;

-      Personnel Benefits (PAGIBIG, ECIP and Medicare); and

-      Those needing Presidential approval and clearances from appropriate government offices (i.e. intelligence fund, research, etc.)

e.      Individual SAROs shall be released corresponding to 25% of the total operational requirements of government owned and controlled corporations (GOCCs) including the PS and MOOE requirements of on-going foreign-assisted projects.

f.        The GARO/SARO releases shall correspondingly be adjusted upon approval by Congress of the FY 1997 budget. In no case, however, shall release per P/A/P exceed the level provided for the same item in the 1997 proposed President ™s budget.

3.2       Release of Notices of Cash Allocation (NCAs)

a.    The DBM shall issue the first quarter NCA based on the GARO/SARO releases.

b.    For decentralized agencies, the funding checks shall be issued monthly to Operating Units based on actual cash requirements.

Cases not covered by this Circular shall referred to DBM.



This Circular shall take effect January 1, 1997.


Adopted: 26 Dec. 1996