by: Ma. Teresa P. Gayon, AA III
The Philippines has a very fragmented system for handling government receipts and payments. As a result, the Bureau of Treasury lacks a unified view over government’s cash resources and requirements.
Treasury Single Account is a unified structure of government bank accounts that aims to consolidate and optimize the use of government cash resources. It is one of the priority projects of the Philippine Public Financial Management Reform Roadmap to enable government to consolidate cash resources on a daily basis and reduce borrowings currently necessitated by perceived cash shortages arising from holding so many government bank accounts and a fragmented system for handling receipts and payments.
TSA is administered by the Bureau of Treasury, and maintained at the Bangko Sentral ng Pilipinas. BSP, as the official depository of the government, shall open a general cash account for the Treasury of the Phils in which the funds of the government shall be deposited. The diagram below outlines the “to-be” process for cash management under TSA.
All revenues (tax and non-tax) collected by authorized depository banks will be swept daily to the Treasury Single Account, maintained in the Central Bank, expenditures are effected from the TSA based on the daily estimated requirements through electronic fund transfer (EFT) to the respective bank account of payees (suppliers, contractors and employees) and the remaining cash balance will be invested on the overnight markets to maximize earnings. Notice of Cash Allocation (NCA) will no longer be issued to the spending departments like DepEd since settlement of obligation is being done by Bureau of Treasury.
What does TSA mean for DepEd?
- TSA will not affect the ability to spend, offices can still continue to spend.
- DepEd will still retain autonomy of spending based on the General Appropriations Act (GAA).
- Bottlenecks on NCA will be eliminated. Cash is about settlement, not spending
- With Electronic Banking and TSA, bank reconciliation challenges will be significantly reduced.