G.R. No. 209287, July 01, 2014
MARIA CAROLINA P. ARAULLO, CHAIRPERSON, BAGONG ALYANSANG MAKABAYAN; JUDY M. TAGUIWALO, PROFESSOR, UNIVERSITY OF THE PHILIPPINES DILIMAN, CO-CHAIRPERSON, PAGBABAGO; HENRI KAHN, CONCERNED CITIZENS MOVEMENT; REP. LUZ ILAGAN, GABRIELA WOMEN’S PARTY REPRESENTATIVE; REP. TERRY L. RIDON, KABATAAN PARTYLIST REPRESENTATIVE; REP. CARLOS ISAGANI ZARATE, BAYAN MUNA PARTY-LIST REPRESENTATIVE; RENATO M. REYES, JR., SECRETARY GENERAL OF BAYAN; MANUEL K. DAYRIT, CHAIRMAN ANG KAPATIRAN PARTY; VENCER MARI E. CRISOSTOMO, CHAIRPERSON, ANAKBAYAN; VICTOR VILLANUEVA, CONVENOR, YOUTH ACT NOW, Petitioner, v. BENIGNO SIMEON C. AQUINO III, PRESIDENT OF THE REPUBLIC OF THE PHILIPPINES; PAQUITO N. OCHOA, JR., EXECUTIVE SECRETARY; AND FLORENCIO B. ABAD, SECRETARY THE DEPARTMENT OF BUDGET AND MANAGEMENT, Respondents.
G.R. NO. 209135
AUGUSTO L. SYJUCO JR., PH.D., Petitioner, v. FLORENCIO B. ABAD, IN HIS CAPACITY AS THE SECRETARY OF DEPARTMENT OF BUDGET AND MANAGEMENT; AND HON. FRANKLIN MAGTUNAO DRILON, IN HIS CAPACITY AS THE SENATE PRESIDENT OF TH PHILIPPINES, Respondents.
G.R. NO. 209136
MANUELITO R. LUNA, Petitioner, v. SECRETARY FLORENCIO ABAD, IN HIS OFFICIAL CAPACITY AS HEAD OF THE DEPARTMENT OF BUDGET AND MANAGEMENT; AND EXECUTIVE SECRETARY PAQUITO OCHOA, IN HIS OFFICIAL CAPACITY AS ALTER EGO OF THE PRESIDENT, Respondents.
G.R. NO. 209155
ATTY. JOSE MALVAR VILLEGAS, JR., Petitioner, v. THE HONORABLE EXECUTIVE SECRETARY PAQUITO N. OCHOA, JR.; AND THE SECRETARY O BUDGET AND MANAGEMENT FLORENCIO B. ABAD, Respondents.
G.R. NO. 209164
PHILIPPINE CONSTITUTION ASSOCIATION (PHILCONSA), REPRESENTED BY DEAN FROILAN BACUNGAN, BENJAMIN E. DIOKNO AND LEONOR M. BRIONES, Petitioner, v. DEPARTMENT OF BUDGET AND MANAGEMENT AND/OR HON. FLORENCIO B. ABAD, Respondents.
G.R. NO. 209260
INTEGRATED BAR OF THE PHILIPPINES (IBP), Petitioner, v. SECRETARY FLORENCIO B. ABAD OF THE DEPARTMENT OF BUDGET AND MANAGEMENT (DBM), Respondent.
G.R. NO. 209442
GRECO ANTONIOUS BEDA B. BELGICA; BISHOP REUBEN M ABANTE AND REV. JOSE L. GONZALEZ, Petitioner, v. PRESIDENT BENIGNO SIMEON C. AQUINO III, THE SENATE OF THE PHILIPPINES, REPRESENTED BY SENATE PRESIDENT FRANKLIN M. DRILON; THE HOUSE OF REPRESENTATIVES, REPRESENTED BY SPEAKER FELICIANO BELMONTE, JR.; THE EXECUTIVE OFFICE, REPRESENTED BY EXECUTIVE SECRETARY PAQUITO N. OCHOA, J THE DEPARTMENT OF BUDGET AND MANAGEMENT, REPRESENTED BY SECRETARY FLORENCIO ABAD; THE DEPARTMENT OF FINANCE, REPRESENTED BY SECRETARY CESAR V. PURISIMA; AND THE BUREAU OF TREASURY, REPRESENTED BY ROSALIA V. DE LEON, Respondents.
G.R. NO. 209517
CONFEDERATION FOR UNITY, RECOGNITION AND ADVANCEMENT OF GOVERNMENT EMPLOYEES (COURAGE), REPRESENTED BY ITS 1ST VICE PRESIDENT, SANTIAGO DASMARINAS, JR.; ROSALINDA NARTATES, FOR HERSELF AND AS NATIONAL PRESIDENT OF THE CONSOLIDATED UNION OF EMPLOYEES NATIONAL HOUSING AUTHORITY (CUE-NHA); MANUEL BACLAGON, FOR HIMSELF AND AS PRESIDENT OF THE SOCIAL WELFARE EMPLOYEES ASSOCIATION OF THE PHILIPPINES, DEPARTMENT OF SOCIAL WELFARE AND DEVELOPMENT CENTRAL OFFICE (SWEAP-DSWD CO); ANTONIA PASCUAL, FOR HERSELF AND AS NATIONAL PRESIDENT OF THE DEPARTMENT OF AGRARIAN REFORM EMPLOYEES ASSOCIATION (DAREA); ALBERT MAGALANG, FOR HIMSELF AND AS PRESIDENT OF THE ENVIRONMENT AND MANAGEMENT BUREAU EMPLOYEES UNION (EMBEU); AND MARCIAL ARABA, FOR HIMSELF AND AS PRESIDENT OF THE KAPISANAN PARA SA KAGALINGAN NG MGA KAWANI NG MMDA (KKK-MMDA), Petitioner, v. BENIGNO SIMEON C. AQUINO III, PRESIDENT OF THE REPUBLIC OF THE PHILIPPINES; PAQUITO OCHOA, JR., EXECUTIVE SECRETARY; AND HON. FLORENCIO B. ABAD, SECRETA OF THE DEPARTMENT OF BUDGET AND MANAGEMENT, Respondents.
G.R. NO. 209569
VOLUNTEERS AGAINST CRIME AND CORRUPTION (VACC), REPRESENTED BY DANTE L. JIMENEZ, Petitioner, v. PAQUITO N. OCHOA, EXECUTIVE SECRETARY, AND FLORENCIO B. ABAD, SECRETARY OF THE DEPARTMENT OF BUDGET AND MANAGEMENT, Respondent.
D E C I S I O N
BERSAMIN, J.:
For resolution are the consolidated petitions assailing the constitutionality of the Disbursement Acceleration Program (DAP), National Budget Circular (NBC) No. 541, and related issuances of the Department of Budget and Management (DBM) implementing the DAP.
Procedural Issue:
A. Whether or not certiorari, prohibition, and mandamus are proper remedies to assail the constitutionality and validity of the Disbursement Acceleration Program (DAP), National Budget Circular (NBC) No. 541, and all other executive issuances allegedly implementing the DAP. Subsumed in this issue are whether there is a controversy ripe for judicial determination, and the standing of petitioners.
Substantive Issues:
B. Whether or not the DAP violates Sec. 29, Art. VI of the 1987 Constitution, which provides: “No money shall be paid out of the Treasury except in pursuance of an appropriation made by law.”
C. Whether or not the DAP, NBC No. 541, and all other executive issuances allegedly implementing the DAP violate Sec. 25(5), Art. VI of the 1987 Constitution insofar as:(a) They treat the unreleased appropriations and unobligated allotments withdrawn from government agencies as “savings” as the term is used in Sec. 25(5), in relation to the provisions of the GAAs of 2011, 2012 and 2013;
(b) They authorize the disbursement of funds for projects or programs not provided in the GAAs for the Executive Department; and
(c) They “augment” discretionary lump sum appropriations in the GAAs.
D. Whether or not the DAP violates: (1) the Equal Protection Clause, (2) the system of checks and balances, and (3) the principle of public accountability enshrined in the 1987 Constitution considering that it authorizes the release of funds upon the request of legislators.
E. Whether or not factual and legal justification exists to issue a temporary restraining order to restrain the implementation of the DAP, NBC No. 541, and all other executive issuances allegedly implementing the DAP.
F. Whether or not the release of unprogrammed funds under the DAP was in accord with the GAAs.
(1) A certified copy of the Memorandum for the President dated June 25, 2012 (Omnibus Authority to Consolidate Savings/ Unutilized Balances and their Realignment);10cralawred
(2) Circulars and orders, which the respondents identified as related to the DAP, namely:
- NBC No. 528 dated January 3, 2011 (Guidelines on the Release of Funds for FY 2011);
- NBC No. 535 dated December 29, 2011 (Guidelines on the Release of Funds for FY 2012);
- NBC No. 541 dated July 18, 2012 (Adoption of Operational Efficiency Measure – Withdrawal of Agencies’ Unobligated Allotments as of June 30, 2012);
- NBC No. 545 dated January 2, 2013 (Guidelines on the Release of Funds for FY 2013);
- DBM Circular Letter No. 2004-2 dated January 26, 2004 (Budgetary Treatment of Commitments/Obligations of the National Government);
- COA-DBM Joint Circular No. 2013-1 dated March 15, 2013 (Revised Guidelines on the Submission of Quarterly Accountability Reports on Appropriations, Allotments, Obligations and Disbursements);
- NBC No. 440 dated January 30, 1995 (Adoption of a Simplified Fund Release System in the Government).
(3) A breakdown of the sources of savings, including savings from discontinued projects and unpaid appropriations for compensation from 2011 to 2013
(1) First Evidence Packet11 – containing seven memoranda issued by the DBM through Sec. Abad, inclusive of annexes, listing in detail the 116 DAP identified projects approved and duly signed by the President, as follows:
- Memorandum for the President dated October 12, 2011 (FY 2011 Proposed Disbursement Acceleration Program (Projects and Sources of Funds);
- Memorandum for the President dated December 12, 2011 (Omnibus Authority to Consolidate Savings/Unutilized Balances and its Realignment);
- Memorandum for the President dated June 25, 2012 (Omnibus Authority to Consolidate Savings/Unutilized Balances and their Realignment);
- Memorandum for the President dated September 4, 2012 (Release of funds for other priority projects and expenditures of the Government);
- Memorandum for the President dated December 19, 2012 (Proposed Priority Projects and Expenditures of the Government);
- Memorandum for the President dated May 20, 2013 (Omnibus Authority to Consolidate Savings/Unutilized Balances and their Realignment to Fund the Quarterly Disbursement Acceleration Program); and
- Memorandum for the President dated September 25, 2013 (Funding for the Task Force Pablo Rehabilitation Plan).
(2) Second Evidence Packet12 – consisting of 15 applications of the DAP, with their corresponding Special Allotment Release Orders (SAROs) and appropriation covers;
(3) Third Evidence Packet13 – containing a list and descriptions of 12 projects under the DAP;
(4) Fourth Evidence Packet14 – identifying the DAP-related portions of the Annual Financial Report (AFR) of the Commission on Audit for 2011 and 2012;
(5) Fifth Evidence Packet15 – containing a letter of Department of Transportation and Communications (DOTC) Sec. Joseph Abaya addressed to Sec. Abad recommending the withdrawal of funds from his agency, inclusive of annexes; and
(6) Sixth Evidence Packet16 – a print-out of the Solicitor General’s visual presentation for the January 28, 2014 oral arguments.
(1) Certified copies of the certifications issued by the Bureau of Treasury to the effect that the revenue collections exceeded the original revenue targets for the years 2011, 2012 and 2013, including collections arising from sources not considered in the original revenue targets, which certifications were required for the release of the unprogrammed funds as provided in Special Provision No. 1 of Article XLV, Article XVI, and Article XLV of the 2011, 2012 and 2013 GAAs; and
(2) A report on releases of savings of the Executive Department for the use of the Constitutional Commissions and other branches of the Government, as well as the fund releases to the Senate and the Commission on Elections (COMELEC).
G.R. No. 209135 (Syjuco) Certiorari, Prohibition and Mandamus G.R. No. 209136 (Luna) Certiorari and Prohibition G.R. No. 209155 (Villegas) Certiorari and Prohibition G.R. No. 209164 (PHILCONSA) Certiorari and Prohibition G.R. No. 209260 (IBP) Prohibition G.R. No. 209287 (Araullo) Certiorari and Prohibition G.R. No. 209442 (Belgica) Certiorari G.R. No. 209517 (COURAGE) Certiorari and Prohibition G.R. No. 209569 (VACC) Certiorari and Prohibition
Section 1. The judicial power shall be vested in one Supreme Court and in such lower courts as may be established by law.
Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable, and to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government.
The Supreme Court, like all other courts, has one main function: to settle actual controversies involving conflicts of rights which are demandable and enforceable. There are rights which are guaranteed by law but cannot be enforced by a judicial party. In a decided case, a husband complained that his wife was unwilling to perform her duties as a wife. The Court said: “We can tell your wife what her duties as such are and that she is bound to comply with them, but we cannot force her physically to discharge her main marital duty to her husband. There are some rights guaranteed by law, but they are so personal that to enforce them by actual compulsion would be highly derogatory to human dignity.”
This is why the first part of the second paragraph of Section 1 provides that:Judicial power includes the duty of courts to settle actual controversies involving rights which are legally demandable or enforceable…The courts, therefore, cannot entertain, much less decide, hypothetical questions. In a presidential system of government, the Supreme Court has, also, another important function. The powers of government are generally considered divided into three branches: the Legislative, the Executive and the Judiciary. Each one is supreme within its own sphere and independent of the others. Because of that supremacy power to determine whether a given law is valid or not is vested in courts of justice.
Briefly stated, courts of justice determine the limits of power of the agencies and offices of the government as well as those of its officers. In other words, the judiciary is the final arbiter on the question whether or not a branch of government or any of its officials has acted without jurisdiction or in excess of jurisdiction, or so capriciously as to constitute an abuse of discretion amounting to excess of jurisdiction or lack of jurisdiction. This is not only a judicial power but a duty to pass judgment on matters of this nature.
This is the background of paragraph 2 of Section 1, which means that the courts cannot hereafter evade the duty to settle matters of this nature, by claiming that such matters constitute a political question. (Bold emphasis supplied)26
MR. NOLLEDO. x x x
The second paragraph of Section 1 states: “Judicial power includes the duty of courts of justice to settle actual controversies…” The term “actual controversies” according to the Commissioner should refer to questions which are political in nature and, therefore, the courts should not refuse to decide those political questions. But do I understand it right that this is restrictive or only an example? I know there are cases which are not actual yet the court can assume jurisdiction. An example is the petition for declaratory relief.
May I ask the Commissioner’s opinion about that?
MR. CONCEPCION. The Supreme Court has no jurisdiction to grant declaratory judgments.
MR. NOLLEDO. The Gentleman used the term “judicial power” but judicial power is not vested in the Supreme Court alone but also in other lower courts as may be created by law.
MR. CONCEPCION. Yes.
MR. NOLLEDO. And so, is this only an example?
MR. CONCEPCION. No, I know this is not. The Gentleman seems to identify political questions with jurisdictional questions. But there is a difference.
MR. NOLLEDO. Because of the expression “judicial power”?
MR. CONCEPCION. No. Judicial power, as I said, refers to ordinary cases but where there is a question as to whether the government had authority or had abused its authority to the extent of lacking jurisdiction or excess of jurisdiction, that is not a political question. Therefore, the court has the duty to decide.27
x x x In times of social disquietude or political excitement, the great landmarks of the Constitution are apt to be forgotten or marred, if not entirely obliterated. In cases of conflict, the judicial department is the only constitutional organ which can be called upon to determine the proper allocation of powers between the several department and among the integral or constituent units thereof.
x x x x
The Constitution is a definition of the powers of government. Who is to determine the nature, scope and extent of such powers? The Constitution itself has provided for the instrumentality of the judiciary as the rational way. And when the judiciary mediates to allocate constitutional boundaries, it does not assert any superiority over the other department; it does not in reality nullify or invalidate an act of the legislature, but only asserts the solemn and sacred obligation assigned to it by the Constitution to determine conflicting claims of authority under the Constitution and to establish for the parties in an actual controversy the rights which that instrument secures and guarantees to them. This is in truth all that is involved in what is termed “judicial supremacy” which properly is the power of judicial review under the Constitution. x x x 29
In the common law, from which the remedy of certiorari evolved, the writ of certiorari was issued out of Chancery, or the King’s Bench, commanding agents or officers of the inferior courts to return the record of a cause pending before them, so as to give the party more sure and speedy justice, for the writ would enable the superior court to determine from an inspection of the record whether the inferior court’s judgment was rendered without authority. The errors were of such a nature that, if allowed to stand, they would result in a substantial injury to the petitioner to whom no other remedy was available. If the inferior court acted without authority, the record was then revised and corrected in matters of law. The writ of certiorari was limited to cases in which the inferior court was said to be exceeding its jurisdiction or was not proceeding according to essential requirements of law and would lie only to review judicial or quasi-judicial acts.
The concept of the remedy of certiorari in our judicial system remains much the same as it has been in the common law. In this jurisdiction, however, the exercise of the power to issue the writ of certiorari is largely regulated by laying down the instances or situations in the Rules of Court in which a superior court may issue the writ of certiorari to an inferior court or officer. Section 1, Rule 65 of the Rules of Court compellingly provides the requirements for that purpose, viz:
x x x x
The sole office of the writ of certiorari is the correction of errors of jurisdiction, which includes the commission of grave abuse of discretion amounting to lack of jurisdiction. In this regard, mere abuse of discretion is not enough to warrant the issuance of the writ. The abuse of discretion must be grave, which means either that the judicial or quasi-judicial power was exercised in an arbitrary or despotic manner by reason of passion or personal hostility, or that the respondent judge, tribunal or board evaded a positive duty, or virtually refused to perform the duty enjoined or to act in contemplation of law, such as when such judge, tribunal or board exercising judicial or quasi-judicial powers acted in a capricious or whimsical manner as to be equivalent to lack of jurisdiction.31
A petition for prohibition is also not the proper remedy to assail an IRR issued in the exercise of a quasi-legislative function. Prohibition is an extraordinary writ directed against any tribunal, corporation, board, officer or person, whether exercising judicial, quasi-judicial or ministerial functions, ordering said entity or person to desist from further proceedings when said proceedings are without or in excess of said entity’s or person’s jurisdiction, or are accompanied with grave abuse of discretion, and there is no appeal or any other plain, speedy and adequate remedy in the ordinary course of law. Prohibition lies against judicial or ministerial functions, but not against legislative or quasi-legislative functions. Generally, the purpose of a writ of prohibition is to keep a lower court within the limits of its jurisdiction in order to maintain the administration of justice in orderly channels. Prohibition is the proper remedy to afford relief against usurpation of jurisdiction or power by an inferior court, or when, in the exercise of jurisdiction in handling matters clearly within its cognizance the inferior court transgresses the bounds prescribed to it by the law, or where there is no adequate remedy available in the ordinary course of law by which such relief can be obtained. Where the principal relief sought is to invalidate an IRR, petitioners’ remedy is an ordinary action for its nullification, an action which properly falls under the jurisdiction of the Regional Trial Court. In any case, petitioners’ allegation that “respondents are performing or threatening to perform functions without or in excess of their jurisdiction” may appropriately be enjoined by the trial court through a writ of injunction or a temporary restraining order.
x x x is one which involves a conflict of legal rights, an assertion of opposite legal claims, susceptible of judicial resolution as distinguished from a hypothetical or abstract difference or dispute. In other words, “[t]here must be a contrariety of legal rights that can be interpreted and enforced on the basis of existing law and jurisprudence.” Related to the requirement of an actual case or controversy is the requirement of “ripeness,” meaning that the questions raised for constitutional scrutiny are already ripe for adjudication. “A question is ripe for adjudication when the act being challenged has had a direct adverse effect on the individual challenging it. It is a prerequisite that something had then been accomplished or performed by either branch before a court may come into the picture, and the petitioner must allege the existence of an immediate or threatened injury to itself as a result of the challenged action.” “Withal, courts will decline to pass upon constitutional issues through advisory opinions, bereft as they are of authority to resolve hypothetical or moot questions.”
DAP as a program, no longer exists, thereby mooting these present cases brought to challenge its constitutionality. Any constitutional challenge should no longer be at the level of the program, which is now extinct, but at the level of its prior applications or the specific disbursements under the now defunct policy. We challenge the petitioners to pick and choose which among the 116 DAP projects they wish to nullify, the full details we will have provided by February 5. We urge this Court to be cautious in limiting the constitutional authority of the President and the Legislature to respond to the dynamic needs of the country and the evolving demands of governance, lest we end up straight-jacketing our elected representatives in ways not consistent with our constitutional structure and democratic principles.40
In public or constitutional litigations, the Court is often burdened with the determination of the locus standi of the petitioners due to the ever-present need to regulate the invocation of the intervention of the Court to correct any official action or policy in order to avoid obstructing the efficient functioning of public officials and offices involved in public service. It is required, therefore, that the petitioner must have a personal stake in the outcome of the controversy, for, as indicated in Agan, Jr. v. Philippine International Air Terminals Co., Inc.:The question on legal standing is whether such parties have “alleged such a personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination of difficult constitutional questions.” Accordingly, it has been held that the interest of a person assailing the constitutionality of a statute must be direct and personal. He must be able to show, not only that the law or any government act is invalid, but also that he sustained or is in imminent danger of sustaining some direct injury as a result of its enforcement, and not merely that he suffers thereby in some indefinite way. It must appear that the person complaining has been or is about to be denied some right or privilege to which he is lawfully entitled or that he is about to be subjected to some burdens or penalties by reason of the statute or act complained of.It is true that as early as in 1937, in People v. Vera, the Court adopted the direct injury test for determining whether a petitioner in a public action had locus standi. There, the Court held that the person who would assail the validity of a statute must have “a personal and substantial interest in the case such that he has sustained, or will sustain direct injury as a result.” Vera was followed in Custodio v. President of the Senate, Manila Race Horse Trainers’ Association v. De la Fuente, Anti-Chinese League of the Philippines v. Felix, and Pascual v. Secretary of Public Works.
Yet, the Court has also held that the requirement of locus standi, being a mere procedural technicality, can be waived by the Court in the exercise of its discretion. For instance, in 1949, in Araneta v. Dinglasan, the Court liberalized the approach when the cases had “transcendental importance.” Some notable controversies whose petitioners did not pass the direct injury test were allowed to be treated in the same way as in Araneta v. Dinglasan.
In the 1975 decision in Aquino v. Commission on Elections, this Court decided to resolve the issues raised by the petition due to their “far-reaching implications,” even if the petitioner had no personality to file the suit. The liberal approach of Aquino v. Commission on Elections has been adopted in several notable cases, permitting ordinary citizens, legislators, and civic organizations to bring their suits involving the constitutionality or validity of laws, regulations, and rulings.
However, the assertion of a public right as a predicate for challenging a supposedly illegal or unconstitutional executive or legislative action rests on the theory that the petitioner represents the public in general. Although such petitioner may not be as adversely affected by the action complained against as are others, it is enough that he sufficiently demonstrates in his petition that he is entitled to protection or relief from the Court in the vindication of a public right.
Quite often, as here, the petitioner in a public action sues as a citizen or taxpayer to gain locus standi. That is not surprising, for even if the issue may appear to concern only the public in general, such capacities nonetheless equip the petitioner with adequate interest to sue. In David v. Macapagal-Arroyo, the Court aptly explains why:
Case law in most jurisdictions now allows both “citizen” and “taxpayer” standing in public actions. The distinction was first laid down in Beauchamp v. Silk, where it was held that the plaintiff in a taxpayer’s suit is in a different category from the plaintiff in a citizen’s suit. In the former, the plaintiff is affected by the expenditure of public funds, while in the latter, he is but the mere instrument of the public concern. As held by the New York Supreme Court in People ex rel Case v. Collins: “In matter of mere public right, however…the people are the real parties…It is at least the right, if not the duty, of every citizen to interfere and see that a public offence be properly pursued and punished, and that a public grievance be remedied.” With respect to taxpayer’s suits, Terr v. Jordan held that “the right of a citizen and a taxpayer to maintain an action in courts to restrain the unlawful use of public funds to his injury cannot be denied.”45
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MEMORANDUM FOR THE PRESIDENTThe memorandum of October 12, 2011 was followed by another memorandum for the President dated December 12, 2011116 requesting omnibus authority to consolidate the savings and unutilized balances for fiscal year 2011. Pertinent portions of the memorandum of December 12, 2011 read:chanRoblesvirtualLawlibrary
x x x x
SUBJECT: FY 2011 PROPOSED DISBURSEMENT ACCELERATION PROGRAM (PROJECTS AND SOURCES OF FUNDS) DATE: OCTOBER 12, 2011
Mr. President, this is to formally confirm your approval of the Disbursement Acceleration Program totaling P72.11 billion. We are already working with all the agencies concerned for the immediate execution of the projects therein.
A. Fund Sources for the Acceleration Program
Fund Sources Amount
(In million Php) Description Action Requested FY 2011 Unreleased Personal Services (PS) appropriations 30,000 Unreleased Personnel Services (PS) appropriations which will lapse at the end of FY 2011 but may be pooled as savings and realigned for priority programs that require immediate funding Declare as savings and approve/ authorize its use for the 2011 Disbursement Acceleration Program FY 2011 Unreleased appropriations 482 Unreleased appropriations (slow moving projects and programs for discontinuance) FY 2010 Unprogrammed Fund 12,336 Supported by the GFI Dividends Approve and authorize its use for the 2011 Disbursement Acceleration Program FY 2010 Carryover Appropriation 21,544 Unreleased appropriations (slow moving projects and programs for discontinuance) and savings from Zero-based Budgeting Initiative With prior approval from the President in November 2010 to declare as savings and with authority to use for priority projects FY 2011 Budget items for realignment 7,748 FY 2011 Agency Budget items that can be realigned within the agency to fund new fast disbursing projects
DPWH-3.981 Billion
DA – 2.497 Billion
DOT – 1.000 Billion
DepEd – 270 Million For informationTOTAL
72.110
B. Projects in the Disbursement Acceleration Program
(Descriptions of projects attached as Annex A)
GOCCs and GFIs Agency/Project
(SARO and NCA Release) Allotment
(in Million Php) 1. LRTA: Rehabilitation of LRT 1 and 2 1,868 2. NHA:a. Resettlement of North Triangle residents to Camarin A7b. Housing for BFP/BJMPc. On-site development for families living along dangerousd. Relocation sites for informal settlers along Iloilo River and its tributaries 11,050 45050010,000100 3. PHIL. HEART CENTER: Upgrading of ageing physical plant and medical equipment 357 4. CREDIT INFO CORP: Establishment of centralized credit information system 75 5. PIDS: purchase of land to relocate the PIDS office and building construction 100 6. HGC: Equity infusion for credit insurance and mortgage guaranty operations of HGC 400 7. PHIC: Obligations incurred (premium subsidy for indigent families) in January-June 2010, booked for payment in Jul[y] – Dec 2010. The delay in payment is due to the delay in the certification of the LGU counterpart. Without it, the NG is obliged to pay the full amount. 1,496 8. Philpost: Purchase of foreclosed property. Payment of Mandatory Obligations, (GSIS, PhilHealth, ECC), Franking Privilege 644 9. BSP: First equity infusion out of Php 40B capitalization under the BSP Law 10,000 10. PCMC: Capital and Equipment Renovation 280 11. LCOP:a. Pediatric Pulmonary Programb. Bio-regenerative Technology Program (Stem-Cell Research – subject to legal review and presentation) 105 35 70 12. TIDCORP: NG Equity infusion 570 TOTAL 26,945
NGAs/LGUs Agency/Project Allotment
(SARO)
(In Million Php) Cash Requirement
(NCA) 13. DOF-BIR: NPSTAR centralization of data processing and others (To be synchronized with GFMIS activities) 758 758 14. COA: IT infrastructure program and hiring of additional litigational experts 144 144 15. DND-PAF: On Base Housing Facilities and Communication Equipment 30 3016. DA:
a. Irrigation, FMRs and Integrated Community-Based Multi-Species Hatchery and Aquasilvi Farming
b. Mindanao Rural Development Project
c. NIA Agno River Integrated Irrigation Project2,959
1,629
919
4112,223
1,629
183
41117. DAR:
a. Agrarian Reform Communities Project 2
b. Landowners Compensation1,293
1,293
1,293
132
5,432 18. DBM: Conduct of National Survey of Farmers/Fisherfolks/IPs 625 625 19. DOJ: Operating requirements of 50 investigation agents and 15 state attorneys 11 11 20. DOT: Preservation of the Cine Corregidor Complex 25 25 21. OPAPP: Activities for Peace Process (PAMANA- Project details: budget breakdown, implementation plan, and conditions on fund release attached as Annex B) 1,819 1,81922. DOST
a. Establishment of National Meterological and Climate Center
b. Enhancement of Doppler Radar Network for National Weather Watch, Accurate Forecasting and Flood Early Warning425
275
190
425
275
150
23. DOF-BOC: To settle the principal obligations with PDIC consistent with the agreement with the CISS and SGS 2,800 2,800 24. OEO-FDCP: Establishment of the National Film Archive and local cinematheques, and other local activities 20 20 25. DPWH: Various infrastructure projects 5,500 5,500 26. DepEd/ERDT/DOST: Thin Client Cloud Computing Project 270 270 27. DOH: Hiring of nurses and midwives 294294
28. TESDA: Training Program in partnership with BPO industry and other sectors 1,100 1,100 29. DILG: Performance Challenge Fund (People Empowered Community Driven Development with DSWD and NAPC) 250 50 30. ARMM: Comprehensive Peace and Development Intervention 8,592 8,592 31. DOTC-MRT: Purchase of additional MRT cars 4,500 - 32. LGU Support Fund 6,500 6,500 33. Various Other Local Projects 6,500 6,500 34. Development Assistance to the Province of Quezon 750 750 TOTAL 45,165 44,000
C. Summary
Fund Sources
Identified for
Approval
(In Million Php) Allotments
for Release Cash
Requirements for
Release in FY
2011 Total 72,110 72,110 70,895 GOCCs 26,895 26,895 NGAs/LGUs 45,165 44,000
For His Excellency’s Consideration
(Sgd.) FLORENCIO B. ABAD[ / ] APPROVED[ ] DISAPPROVED(Sgd.) H.E. BENIGNO S. AQUINO, III
OCT 12, 2011
MEMORANDUM FOR THE PRESIDENT
x x x x
SUBJECT: Omnibus Authority to Consolidate Savings/Unutilized Balances and its Realignment DATE: December 12, 2011
This is to respectfully request for the grant of Omnibus Authority to consolidate savings/unutilized balances in FY 2011 corresponding to completed or discontinued projects which may be pooled to fund additional projects or expenditures.
In addition, Mr. President, this measure will allow us to undertake projects even if their implementation carries over to 2012 without necessarily impacting on our budget deficit cap next year.
BACKGROUND
1.0 The DBM, during the course of performance reviews conducted on the agencies’ operations, particularly on the implementation of their projects/activities, including expenses incurred in undertaking the same, have identified savings out of the 2011 General Appropriations Act. Said savings correspond to completed or discontinued projects under certain departments/agencies which may be pooled, for the following: 1.1 to provide for new activities which have not been anticipated during preparation of the budget; 1.2 to augment additional requirements of on-going priority projects; and 1.3 to provide for deficiencies under the Special Purpose Funds, e.g., PDAF, Calamity Fund, Contingent Fund 1.4 to cover for the modifications of the original allotment class allocation as a result of on-going priority projects and implementation of new activities 2.0 x x x x 2.1 x x x 2.2 x x x
ON THE UTILIZATION OF POOLED SAVINGS
3.0 It may be recalled that the President approved our request for omnibus authority to pool savings/unutilized balances in FY 2010 last November 25, 2010. 4.0 It is understood that in the utilization of the pooled savings, the DBM shall secure the corresponding approval/confirmation of the President. Furthermore, it is assured that the proposed realignments shall be within the authorized Expenditure level. 5.0 Relative thereto, we have identified some expenditure items that may be sourced from the said pooled appropriations in FY 2010 that will expire on December 31, 2011 and appropriations in FY 2011 that may be declared as savings to fund additional expenditures. 5.1 The 2010 Continuing Appropriations (pooled savings) is proposed to be spent for the projects that we have identified to be immediate actual disbursements considering that this same fund source will expire on December 31, 2011. 5.2 With respect to the proposed expenditure items to be funded from the FY 2011 Unreleased Appropriations, most of these are the same projects for which the DBM is directed by the Office of the President, thru the Executive Secretary, to source funds. 6.0 Among others, the following are such proposed additional projects that have been chosen given their multiplier impact on economy and infrastructure development, their beneficial effect on the poor, and their translation into disbursements. Please note that we have classified the list of proposed projects as follows: 7.0 x x x
FOR THE PRESIDENT’S APPROVAL
8.0 Foregoing considered, may we respectfully request for the President’s approval for the following: 8.1 Grant of omnibus authority to consolidate FY 2011 savings/unutilized balances and its realignment; and 8.2 The proposed additional projects identified for funding.
For His Excellency’s consideration and approval.
(Sgd.)[ / ] APPROVED
[ ] DISAPPROVED(Sgd.) H.E. BENIGNO S. AQUINO, III
DEC 21, 2011
NATIONAL BUDGET CIRCULAR | No. 541 | ||
July 18, 2012 | |||
TO | : | All Heads of Departments/Agencies/State Universities and Colleges and other Offices of the National Government, Budget and Planning Officers; Heads of Accounting Units and All Others Concerned | |
SUBJECT | : | Adoption of Operational Efficiency Measure – Withdrawal of Agencies’ Unobligated Allotments as of June 30, 2012 |
1.0 | Rationale | ||
The DBM, as mandated by Executive Order (EO) No. 292 (Administrative Code of 1987), periodically reviews and evaluates the departments/agencies’ efficiency and effectiveness in utilizing budgeted funds for the delivery of services and production of goods, consistent with the government priorities. In the event that a measure is necessary to further improve the operational efficiency of the government, the President is authorized to suspend or stop further use of funds allotted for any agency or expenditure authorized in the General Appropriations Act. Withdrawal and pooling of unutilized allotment releases can be effected by DBM based on authority of the President, as mandated under Sections 38 and 39, Chapter 5, Book VI of EO 292. For the first five months of 2012, the National Government has not met its spending targets. In order to accelerate spending and sustain the fiscal targets during the year, expenditure measures have to be implemented to optimize the utilization of available resources. Departments/agencies have registered low spending levels, in terms of obligations and disbursements per initial review of their 2012 performance. To enhance agencies’ performance, the DBM conducts continuous consultation meetings and/or send call-up letters, requesting them to identify slow-moving programs/projects and the factors/issues affecting their performance (both pertaining to internal systems and those which are outside the agencies’ spheres of control). Also, they are asked to formulate strategies and improvement plans for the rest of 2012. Notwithstanding these initiatives, some departments/agencies have continued to post low obligation levels as of end of first semester, thus resulting to substantial unobligated allotments. In line with this, the President, per directive dated June 27, 2012 authorized the withdrawal of unobligated allotments of agencies with low levels of obligations as of June 30, 2012, both for continuing and current allotments. This measure will allow the maximum utilization of available allotments to fund and undertake other priority expenditures of the national government. | |||
2.0 | Purpose | ||
2.1 | To provide the conditions and parameters on the withdrawal of unobligated allotments of agencies as of June 30, 2012 to fund priority and/or fast-moving programs/projects of the national government; | ||
2.2 | To prescribe the reports and documents to be used as bases on the withdrawal of said unobligated allotments; and | ||
2.3 | To provide guidelines in the utilization or reallocation of the withdrawn allotments. | ||
3.0 | Coverage | ||
3.1 | These guidelines shall cover the withdrawal of unobligated allotments as of June 30, 2012 of all national government agencies (NGAs) charged against FY 2011 Continuing Appropriation (R.A. No.10147) and FY 2012 Current Appropriation (R.A. No. 10155), pertaining to: | ||
3.1.1 | Capital Outlays (CO); | ||
3.1.2 | Maintenance and Other Operating Expenses (MOOE) related to the implementation of programs and projects, as well as capitalized MOOE; and | ||
3.1.3 | Personal Services corresponding to unutilized pension benefits declared as savings by the agencies concerned based on their updated/validated list of pensioners. | ||
3.2 | The withdrawal of unobligated allotments may cover the identified programs, projects and activities of the departments/agencies reflected in the DBM list shown as Annex A or specific programs and projects as may be identified by the agencies. | ||
4.0 | Exemption | ||
These guidelines shall not apply to the following: | |||
4.1 | NGAs | ||
4.1.1 | Constitutional Offices/Fiscal Autonomy Group, granted fiscal autonomy under the Philippine Constitution; and | ||
4.1.2 | State Universities and Colleges, adopting the Normative Funding allocation scheme i.e., distribution of a predetermined budget ceiling. | ||
4.2 | Fund Sources | ||
4.2.1 | Personal Services other than pension benefits; | ||
4.2.2 | MOOE items earmarked for specific purposes or subject to realignment conditions per General Provisions of the GAA: | ||
| |||
4.2.3 | Foreign-Assisted Projects (loan proceeds and peso counterpart); | ||
4.2.4 | Special Purpose Funds such as: E-Government Fund, International Commitments Fund, PAMANA, Priority Development Assistance Fund, Calamity Fund, Budgetary Support to GOCCs and Allocation to LGUs, among others; | ||
4.2.5 | Quick Response Funds; and | ||
4.2.6 | Automatic Appropriations i.e., Retirement Life Insurance Premium and Special Accounts in the General Fund. | ||
5.0 | Guidelines | ||
5.1 | National government agencies shall continue to undertake procurement activities notwithstanding the implementation of the policy of withdrawal of unobligated allotments until the end of the third quarter, FY 2012. Even without the allotments, the agency shall proceed in undertaking the procurement processes (i.e., procurement planning up to the conduct of bidding but short of awarding of contract) pursuant to GPPB Circular Nos. 02-2008 and 01-2009 and DBM Circular Letter No. 2010-9. | ||
5.2 | For the purpose of determining the amount of unobligated allotments that shall be withdrawn, all departments/agencies/operating units (OUs) shall submit to DBM not later than July 30, 2012, the following budget accountability reports as of June 30, 2012; | ||
| |||
5.3 | In the absence of the June 30, 2012 reports cited under item 5.2 of this Circular, the agency’s latest report available shall be used by DBM as basis for withdrawal of allotment. The DBM shall compute/approximate the agency’s obligation level as of June 30 to derive its unobligated allotments as of same period. Example: If the March 31 SAOB or FRO reflects actual obligations of P 800M then the June 30 obligation level shall approximate to P1,600 M (i.e., P800 M x 2 quarters). | ||
5.4 | All released allotments in FY 2011 charged against R.A. No. 10147 which remained unobligated as of June 30, 2012 shall be immediately considered for withdrawal. This policy is based on the following considerations: | ||
5.4.1 | The departments/agencies’ approved priority programs and projects are assumed to be implementation-ready and doable during the given fiscal year; and | ||
5.4.2 | The practice of having substantial carryover appropriations may imply that the agency has a slower-than-programmed implementation capacity or agency tends to implement projects within a two-year timeframe. | ||
5.5. | Consistent with the President’s directive, the DBM shall, based on evaluation of the reports cited above and results of consultations with the departments/agencies, withdraw the unobligated allotments as of June 30, 2012 through issuance of negative Special Allotment Release Orders (SAROs). | ||
5.6 | DBM shall prepare and submit to the President, a report on the magnitude of withdrawn allotments. The report shall highlight the agencies which failed to submit the June 30 reports required under this Circular. | ||
5.7 | The withdrawn allotments may be: | ||
5.7.1 | Reissued for the original programs and projects of the agencies/OUs concerned, from which the allotments were withdrawn; | ||
5.7.2 | Realigned to cover additional funding for other existing programs and projects of the agency/OU; or | ||
5.7.3 | Used to augment existing programs and projects of any agency and to fund priority programs and projects not considered in the 2012 budget but expected to be started or implemented during the current year. | ||
5.8 | For items 5.7.1 and 5.7.2 above, agencies/OUs concerned may submit to DBM a Special Budget Request (SBR), supported with the following: | ||
5.8.1 | Physical and Financial Plan (PFP); | ||
5.8.2 | Monthly Cash Program (MCP); and | ||
5.8.3 | Proof that the project/activity has started the procurement processes i.e., Proof of Posting and/or Advertisement of the Invitation to Bid. | ||
5.9 | The deadline for submission of request/s pertaining to these categories shall be until the end of the third quarter i.e., September 30, 2012. After said cut-off date, the withdrawn allotments shall be pooled and form part of the overall savings of the national government. | ||
5.10 | Utilization of the consolidated withdrawn allotments for other priority programs and projects as cited under item 5.7.3 of this Circular, shall be subject to approval of the President. Based on the approval of the President, DBM shall issue the SARO to cover the approved priority expenditures subject to submission by the agency/OU concerned of the SBR and supported with PFP and MCP. | ||
5.11 | It is understood that all releases to be made out of the withdrawn allotments (both 2011 and 2012 unobligated allotments) shall be within the approved Expenditure Program level of the national government for the current year. The SAROs to be issued shall properly disclose the appropriation source of the release to determine the extent of allotment validity, as follows: | ||
| |||
5.12 | Timely compliance with the submission of existing BARs and other reportorial requirements is reiterated for monitoring purposes. | ||
6.0 | Effectivity |
c. DAP was not an appropriationimplement it
measure; hence, no appropriation
law was required to adopt or to
a. Although executive discretionWe begin this dissection by reiterating that Congress cannot anticipate all issues and needs that may come into play once the budget reaches its execution stage. Executive discretion is necessary at that stage to achieve a sound fiscal administration and assure effective budget implementation. The heads of offices, particularly the President, require flexibility in their operations under performance budgeting to enable them to make whatever adjustments are needed to meet established work goals under changing conditions.128 In particular, the power to transfer funds can give the President the flexibility to meet unforeseen events that may otherwise impede the efficient implementation of the PAPs set by Congress in the GAA.
and flexibility are necessary in
the execution of the budget, any
transfer of appropriated funds
should conform to Section 25(5),
Article VI of the Constitution
[T]he impulse to deny discretionary authority altogether should be resisted. There are many number of reasons why obligations and outlays by administrators may have to differ from appropriations by legislators. Appropriations are made many months, and sometimes years, in advance of expenditures. Congress acts with imperfect knowledge in trying to legislate in fields that are highly technical and constantly undergoing change. New circumstances will develop to make obsolete and mistaken the decisions reached by Congress at the appropriation stage. It is not practicable for Congress to adjust to each new development by passing separate supplemental appropriation bills. 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.
x x x x
x x x The expenditure process, by its very nature, requires substantial discretion for administrators. They need to exercise judgment and take responsibility for their actions, but those actions ought to be directed toward executing congressional, not administrative policy. Let there be discretion, but channel it and use it to satisfy the programs and priorities established by Congress.
The Judiciary, the Constitutional Commissions, and the Ombudsman must have the independence and flexibility needed in the discharge of their constitutional duties. The imposition of restrictions and constraints on the manner the independent constitutional offices allocate and utilize the funds appropriated for their operations is anathema to fiscal autonomy and violative not only of the express mandate of the Constitution but especially as regards the Supreme Court, of the independence and separation of powers upon which the entire fabric of our constitutional system is based.
(5) No law shall be passed authorizing any transfer of appropriations; however, the President, the Prime Minister, the Speaker, the Chief Justice of the Supreme Court, and the heads of Constitutional Commissions may by law be authorized to augment any item in the general appropriations law for their respective offices from savings in other items of their respective appropriations.
Section 44. Authority to Approve Fund Transfers. The President shall have the authority to transfer any fund appropriated for the different departments, bureaus, offices and agencies of the Executive Department which are included in the General Appropriations Act, to any program, project, or activity of any department, bureau or office included in the General Appropriations Act or approved after its enactment.
The President shall, likewise, have the authority to augment any appropriation of the Executive Department in the General Appropriations Act, from savings in the appropriations of another department, bureau, office or agency within the Executive Branch, pursuant to the provisions of Article VIII, Section 16 (5) of the Constitution.
Paragraph 1 of Section 44 of P.D. No. 1177 unduly over-extends the privilege granted under said Section 16. It empowers the President to indiscriminately transfer funds from one department, bureau, office or agency of the Executive Department to any program, project or activity of any department, bureau or office included in the General Appropriations Act or approved after its enactment, without regard as to whether or not the funds to be transferred are actually savings in the item from which the same are to be taken, or whether or not the transfer is for the purpose of augmenting the item to which said transfer is to be made. It does not only completely disregard the standards set in the fundamental law, thereby amounting to an undue delegation of legislative powers, but likewise goes beyond the tenor thereof. Indeed, such constitutional infirmities render the provision in question null and void.143
Section 25. x x x
x x x x
5) No law shall be passed authorizing any transfer of appropriations; however, the President, the President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, and the heads of Constitutional Commissions may, by law, be authorized to augment any item in the general appropriations law for their respective offices from savings in other items of their respective appropriations.
x x x x
In the funding of current activities, projects, and programs, the general rule should still be that the budgetary amount contained in the appropriations bill is the extent Congress will determine as sufficient for the budgetary allocation for the proponent agency. The only exception is found in Section 25 (5), Article VI of the Constitution, by which the President, the President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, and the heads of Constitutional Commissions are authorized to transfer appropriations to augment any item in the GAA for their respective offices from the savings in other items of their respective appropriations. The plain language of the constitutional restriction leaves no room for the petitioner’s posture, which we should now dispose of as untenable.
It bears emphasizing that the exception in favor of the high officials named in Section 25(5), Article VI of the Constitution limiting the authority to transfer savings only to augment another item in the GAA is strictly but reasonably construed as exclusive. As the Court has expounded in Lokin, Jr. v. Commission on Elections:When the statute itself enumerates the exceptions to the application of the general rule, the exceptions are strictly but reasonably construed. The exceptions extend only as far as their language fairly warrants, and all doubts should be resolved in favor of the general provision rather than the exceptions. Where the general rule is established by a statute with exceptions, none but the enacting authority can curtail the former. Not even the courts may add to the latter by implication, and it is a rule that an express exception excludes all others, although it is always proper in determining the applicability of the rule to inquire whether, in a particular case, it accords with reason and justice.
The appropriate and natural office of the exception is to exempt something from the scope of the general words of a statute, which is otherwise within the scope and meaning of such general words. Consequently, the existence of an exception in a statute clarifies the intent that the statute shall apply to all cases not excepted. Exceptions are subject to the rule of strict construction; hence, any doubt will be resolved in favor of the general provision and against the exception. Indeed, the liberal construction of a statute will seem to require in many circumstances that the exception, by which the operation of the statute is limited or abridged, should receive a restricted construction.
b. Requisites for the valid transferThe transfer of appropriated funds, to be valid under Section 25(5), supra, must be made upon a concurrence of the following requisites, namely:chanRoblesvirtualLawlibrary
of appropriated funds under Section
25(5), Article VI of the 1987
Constitution
(1) There is a law authorizing the President, the President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, and the heads of the Constitutional Commissions to transfer funds within their respective offices;
(2) The funds to be transferred are savings generated from the appropriations for their respective offices; and
(3) The purpose of the transfer is to augment an item in the general appropriations law for their respective offices.
b.1. First Requisite –GAAs of 2011Section 25(5), supra, not being a self-executing provision of the Constitution, must have an implementing law for it to be operative. That law, generally, is the GAA of a given fiscal year. To comply with the first requisite, the GAAs should expressly authorize the transfer of funds.
and 2012 lacked valid provisions to
authorize transfers of funds under
the DAP; hence, transfers under the
DAP were unconstitutional
Section 59. Use of Savings. The President of the Philippines, the Senate President, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, the Heads of Constitutional Commissions enjoying fiscal autonomy, and the Ombudsman are hereby authorized to augment any item in this Act from savings in other items of their respective appropriations.
Section 53. Use of Savings. The President of the Philippines, the Senate President, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, the Heads of Constitutional Commissions enjoying fiscal autonomy, and the Ombudsman are hereby authorized to augment any item in this Act from savings in other items of their respective appropriations.
Section 52. Use of Savings. The President of the Philippines, the Senate President, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, the Heads of Constitutional Commissions enjoying fiscal autonomy, and the Ombudsman are hereby authorized to use savings in their respective appropriations to augment actual deficiencies incurred for the current year in any item of their respective appropriations.
b.2. Second Requisite – There wereWere the funds used in the DAP actually savings?
no savings from which funds could
be sourced for the DAP
Savings refer to portions or balances of any programmed appropriation in this Act free from any obligation or encumbrance which are: (i) still available after the completion or final discontinuance or abandonment of the work, activity or purpose for which the appropriation is authorized; (ii) from appropriations balances arising from unpaid compensation and related costs pertaining to vacant positions and leaves of absence without pay; and (iii) from appropriations balances realized from the implementation of measures resulting in improved systems and efficiencies and thus enabled agencies to meet and deliver the required or planned targets, programs and services approved in this Act at a lesser cost.
On the Authority to Withdraw Unobligated allotments
5.0 The DBM, during the course of performance reviews conducted on the agencies’ operations, particularly on the implementation of their projects/activities, including expenses incurred in undertaking the same, have been continuously calling the attention of all National Government agencies (NGAs) with low levels of obligations as of end of the first quarter to speed up the implementation of their programs and projects in the second quarter. 6.0 Said reminders were made in a series of consultation meetings with the concerned agencies and with call-up letters sent. 7.0 Despite said reminders and the availability of funds at the department’s disposal, the level of financial performance of some departments registered below program, with the targeted obligations/disbursements for the first semester still not being met. 8.0 In order to maximize the use of the available allotment, all unobligated balances as of June 30, 2012, both for continuing and current allotments shall be withdrawn and pooled to fund fast moving programs/projects. 9.0 It may be emphasized that the allotments to be withdrawn will be based on the list of slow moving projects to be identified by the agencies and their catch up plans to be evaluated by the DBM.
3.1. These guidelines shall cover the withdrawal of unobligated allotments as of June 30, 2012 of all national government agencies (NGAs) charged against FY 2011 Continuing Appropriation (R.A. No. 10147) and FY 2012 Current Appropriation (R.A. No. 10155), pertaining to: 3.1.1 Capital Outlays (CO); 3.1.2 Maintenance and Other Operating Expenses (MOOE) related to the implementation of programs and projects, as well as capitalized MOOE; and 3.1.3 Personal Services corresponding to unutilized pension benefits declared as savings by the agencies concerned based on their undated/validated list of pensioners.
5.4.1 The departments/agencies’ approved priority programs and projects are assumed to be implementation-ready and doable during the given fiscal year; and 5.4.2 The practice of having substantial carryover appropriations may imply that the agency has a slower-than-programmed implementation capacity or agency tends to implement projects within a two-year timeframe.
Section 65. Availability of Appropriations. — Appropriations for MOOE and capital outlays authorized in this Act shall be available for release and obligation for the purpose specified, and under the same special provisions applicable thereto, for a period extending to one fiscal year after the end of the year in which such items were appropriated: PROVIDED, That appropriations for MOOE and capital outlays under R.A. No. 9970 shall be made available up to the end of FY 2011: PROVIDED, FURTHER, That a report on these releases and obligations shall be submitted to the Senate Committee on Finance and the House Committee on Appropriations.
Section 63. Availability of Appropriations. — Appropriations for MOOE and capital outlays authorized in this Act shall be available for release and obligation for the purpose specified, and under the same special provisions applicable thereto, for a period extending to one fiscal year after the end of the year in which such items were appropriated: PROVIDED, That a report on these releases and obligations shall be submitted to the Senate Committee on Finance and the House Committee on Appropriations, either in printed form or by way of electronic document.154
Section 63. Availability of Appropriations.— All appropriations authorized in this Act shall be available for release and obligation for the purposes specified, and under the same special provisions applicable thereto, until the end of FY 2013: PROVIDED, That a report on these releases and obligations shall be submitted to the Senate Committee on Finance and House Committee on Appropriations, either in printed form or by way of electronic document.
7.0 If the level of financial performance of some department will register below program, even with the availability of funds at their disposal, the targeted obligations/disbursements for each quarter will not be met. It is important to note that these funds will lapse at the end of the fiscal year if these remain unobligated. 8.0 To maximize the use of the available allotment, all unobligated balances at the end of every quarter, both for continuing and current allotments shall be withdrawn and pooled to fund fast moving programs/projects. 9.0 It may be emphasized that the allotments to be withdrawn will be based on the list of slow moving projects to be identified by the agencies and their catch up plans to be evaluated by the DBM.
5.2 For the purpose of determining the amount of unobligated allotments that shall be withdrawn, all departments/agencies/operating units (OUs) shall submit to DBM not later than July 30, 2012, the following budget accountability reports as of June 30, 2012;
- Statement of Allotments, Obligation and Balances (SAOB);
- Financial Report of Operations (FRO); and
- Physical Report of Operations.
5.3 In the absence of the June 30, 2012 reports cited under item 5.2 of this Circular, the agency’s latest report available shall be used by DBM as basis for withdrawal of allotment. The DBM shall compute/approximate the agency’s obligation level as of June 30 to derive its unobligated allotments as of same period. Example: If the March 31 SAOB or FRO reflects actual obligations of P 800M then the June 30 obligation level shall approximate to P1,600 M (i.e., P800 M x 2 quarters).
Section 66. Prohibition Against Impoundment of Appropriations. No appropriations authorized under this Act shall be impounded through retention or deduction, unless in accordance with the rules and regulations to be issued by the DBM: PROVIDED, That all the funds appropriated for the purposes, programs, projects and activities authorized under this Act, except those covered under the Unprogrammed Fund, shall be released pursuant to Section 33 (3), Chapter 5, Book VI of E.O. No. 292.
Section 67. Unmanageable National Government Budget Deficit. Retention or deduction of appropriations authorized in this Act shall be effected only in cases where there is an unmanageable national government budget deficit.
Unmanageable national government budget deficit as used in this section shall be construed to mean that (i) the actual national government budget deficit has exceeded the quarterly budget deficit targets consistent with the full-year target deficit as indicated in the FY 2011 Budget of Expenditures and Sources of Financing submitted by the President and approved by Congress pursuant to Section 22, Article VII of the Constitution, or (ii) there are clear economic indications of an impending occurrence of such condition, as determined by the Development Budget Coordinating Committee and approved by the President.
Section 68. Prohibition Against Retention/Deduction of Allotment. Fund releases from appropriations provided in this Act shall be transmitted intact or in full to the office or agency concerned. No retention or deduction as reserves or overhead shall be made, except as authorized by law, or upon direction of the President of the Philippines. The COA shall ensure compliance with this provision to the extent that sub-allotments by agencies to their subordinate offices are in conformity with the release documents issued by the DBM.
Section 38. Suspension of Expenditure of Appropriations. - Except as otherwise provided in the General Appropriations Act and whenever in his judgment the public interest so requires, the President, upon notice to the head of office concerned, is authorized to suspend or otherwise stop further expenditure of funds allotted for any agency, or any other expenditure authorized in the General Appropriations Act, except for personal services appropriations used for permanent officials and employees.
Section 28. Reversion of Unexpended Balances of Appropriations, Continuing Appropriations. - Unexpended balances of appropriations authorized in the General Appropriation Act shall revert to the unappropriated surplus of the General Fund at the end of the fiscal year and shall not thereafter be available for expenditure except by subsequent legislative enactment: Provided, that appropriations for capital outlays shall remain valid until fully spent or reverted: provided, further, that continuing appropriations for current operating expenditures may be specifically recommended and approved as such in support of projects whose effective implementation calls for multi-year expenditure commitments: provided, finally, that the President may authorize the use of savings realized by an agency during given year to meet non-recurring expenditures in a subsequent year.
The balances of continuing appropriations shall be reviewed as part of the annual budget preparation process and the preparation process and the President may approve upon recommendation of the Secretary, the reversion of funds no longer needed in connection with the activities funded by said continuing appropriations.
b.3. Third Requisite – No funds fromThe third requisite for a valid transfer of funds is that the purpose of the transfer should be “to augment an item in the general appropriations law for the respective offices.” The term “augment” means to enlarge or increase in size, amount, or degree.160cralawred
savings could be transferred under
the DAP to augment deficient items
not provided in the GAA
x x x Augmentation implies the existence in this Act of a program, activity, or project with an appropriation, which upon implementation, or subsequent evaluation of needed resources, is determined to be deficient. In no case shall a non-existent program, activity, or project, be funded by augmentation from savings or by the use of appropriations otherwise authorized in this Act.
Section 52. Use of Savings. The President of the Philippines, the Senate President, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, the Heads of Constitutional Commissions enjoying fiscal autonomy, and the Ombudsman are hereby authorized to use savings in their respective appropriations to augment actual deficiencies incurred for the current year in any item of their respective appropriations.
(i) P1.5 billion for the Cordillera People’s Liberation Army; (ii) P1.8 billion for the Moro National Liberation Front; (iii) P700 million for assistance to Quezon Province;164 (iv) P50 million to P100 (million) each to certain senators;165 (v) P10 billion for the relocation of families living along dangerous zones under the National Housing Authority; (vi) P10 billion and P20 billion equity infusion under the Bangko Sentral; (vii) P5.4 billion landowners’ compensation under the Department of Agrarian Reform; (viii) P8.6 billion for the ARMM comprehensive peace and development program; (ix) P6.5 billion augmentation of LGU internal revenue allotments (x) P5 billion for crucial projects like tourism road construction under the Department of Tourism and the Department of Public Works and Highways; (xi) P1.8 billion for the DAR-DPWH Tulay ng Pangulo; (xii) P1.96 billion for the DOH-DPWH rehabilitation of regional health units; and (xiii) P4 billion for the DepEd-PPP school infrastructure projects.166
APPROPRIATION CODE | PARTICULARS | AMOUNT AUTHORIZED |
A.03.a.01.a | Generation of new knowledge and technologies and research capability building in priority areas identified as strategic to National Development |
|
Personnel Services | Maintenance and Other Operating Expenditures | Capital Outlays | TOTAL | ||||
III. Operations | |||||||
a. | Funding Assistance to Science and Technology Activities | 177,406,000 | 1,887,365,000 | 49,090,000 | 2,113,861,000 | ||
1. Central Office | 1,554,238,000 | 1,554,238,000 | |||||
a. | Generation of new knowledge and technologies and research capability building in priority areas identified as strategic to National Development | 537,910,000 | 537,910,000 |
APPROPRIATION CODE | PARTICULARS | AMOUNT AUTHORIZED |
A.02.a | Development, integration and coordination of the National Research System for Industry, Energy and Emerging Technology and Related Fields Capital Outlays | P 300,000,000 |
b.4 Third Requisite – Cross-borderBy providing that the President, the President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, and the Heads of the Constitutional Commissions may be authorized to augment any item in the GAA “for their respective offices,” Section 25(5), supra, has delineated borders between their offices, such that funds appropriated for one office are prohibited from crossing over to another office even in the guise of augmentation of a deficient item or items. Thus, we call such transfers of funds cross-border transfers or cross-border augmentations.
augmentations from savings were
prohibited by the Constitution
JUSTICE BERSAMIN:
Alright, the whole time that you have been Secretary of Department of Budget and Management, did the Executive Department ever redirect any part of savings of the National Government under your control cross border to another department?
SECRETARY ABAD:
Well, in the Memos that we submitted to you, such an instance, Your Honor
JUSTICE BERSAMIN:
Can you tell me two instances? I don’t recall having read your material.
SECRETARY ABAD:
Well, the first instance had to do with a request from the House of Representatives. They started building their e-library in 2010 and they had a budget for about 207 Million but they lack about 43 Million to complete its 250 Million requirements. Prior to that, the COA, in an audit observation informed the Speaker that they had to continue with that construction otherwise the whole building, as well as the equipments therein may suffer from serious deterioration. And at that time, since the budget of the House of Representatives was not enough to complete 250 Million, they wrote to the President requesting for an augmentation of that particular item, which was granted, Your Honor. The second instance in the Memos is a request from the Commission on Audit. At the time they were pushing very strongly the good governance programs of the government and therefore, part of that is a requirement to conduct audits as well as review financial reports of many agencies. And in the performance of that function, the Commission on Audit needed information technology equipment as well as hire consultants and litigators to help them with their audit work and for that they requested funds from the Executive and the President saw that it was important for the Commission to be provided with those IT equipments and litigators and consultants and the request was granted, Your Honor.
JUSTICE BERSAMIN:
These cross border examples, cross border augmentations were not supported by appropriations…
SECRETARY ABAD:
They were, we were augmenting existing items within their… (interrupted)
JUSTICE BERSAMIN:
No, appropriations before you augmented because this is a cross border and the tenor or text of the Constitution is quite clear as far as I am concerned. It says here, “The power to augment may only be made to increase any item in the General Appropriations Law for their respective offices.” Did you not feel constricted by this provision?
SECRETARY ABAD:
Well, as the Constitution provides, the prohibition we felt was on the transfer of appropriations, Your Honor. What we thought we did was to transfer savings which was needed by the Commission to address deficiency in an existing item in both the Commission as well as in the House of Representatives; that’s how we saw…(interrupted)
JUSTICE BERSAMIN:
So your position as Secretary of Budget is that you could do that?
SECRETARY ABAD:
In an extreme instances because…(interrupted)
JUSTICE BERSAMIN:
No, no, in all instances, extreme or not extreme, you could do that, that’s your feeling.
SECRETARY ABAD:
Well, in that particular situation when the request was made by the Commission and the House of Representatives, we felt that we needed to respond because we felt…(interrupted).183
OFFICE | PURPOSE | DATE RELEASED | AMOUNT (In thousand pesos) | |
Reserve Imposed | Releases | |||
Commission on Audit | IT Infrastructure Program and hiring of additional litigation experts | 11/11/11 | 143,700 | |
Congress – House of Representatives | Completion of the construction of the Legislative Library and Archives Building/ Congressional e-library | 07/23/12 | 207,034 (Savings of HOR) | 250,000 |
99. The Constitution does not prevent the President from transferring savings of his department to another department upon the latter’s request, provided it is the recipient department that uses such funds to augment its own appropriation. In such a case, the President merely gives the other department access to public funds but he cannot dictate how they shall be applied by that department whose fiscal autonomy is guaranteed by the Constitution.188
HONORABLE MENDOZA:
The cross-border transfers, if Your Honors please, is not an application of the DAP. What were these cross-border transfers? They are transfers of savings as defined in the various General Appropriations Act. So, that makes it similar to the DAP, the use of savings. There was a cross-border which appears to be in violation of Section 25, paragraph 5 of Article VI, in the sense that the border was crossed. But never has it been claimed that the purpose was to augment a deficient item in another department of the government or agency of the government. The cross-border transfers, if Your Honors please, were in the nature of [aid] rather than augmentations. Here is a government entity separate and independent from the Executive Department solely in need of public funds. The President is there 24 hours a day, 7 days a week. He’s in charge of the whole operation although six or seven heads of government offices are given the power to augment. Only the President stationed there and in effect in-charge and has the responsibility for the failure of any part of the government. You have election, for one reason or another, the money is not enough to hold election. There would be chaos if no money is given as an aid, not to augment, but as an aid to a department like COA. The President is responsible in a way that the other heads, given the power to augment, are not. So, he cannot very well allow this, if Your Honor please.189cralawred
JUSTICE LEONEN:
May I move to another point, maybe just briefly. I am curious that the position now, I think, of government is that some transfers of savings is now considered to be, if I’m not mistaken, aid not augmentation. Am I correct in my hearing of your argument?
HONORABLE MENDOZA:
That’s our submission, if Your Honor, please.
JUSTICE LEONEN:
May I know, Justice, where can we situate this in the text of the Constitution? Where do we actually derive the concepts that transfers of appropriation from one branch to the other or what happened in DAP can be considered as aid? What particular text in the Constitution can we situate this?
HONORABLE MENDOZA:
There is no particular provision or statutory provision for that matter, if Your Honor please. It is drawn from the fact that the Executive is the executive in-charge of the success of the government.
JUSTICE LEONEN:
So, the residual powers labelled in Marcos v. Manglapus would be the basis for this theory of the government?
HONORABLE MENDOZA:
Yes, if Your Honor, please.
JUSTICE LEONEN:
A while ago, Justice Carpio mentioned that the remedy is might be to go to Congress. That there are opportunities and there have been opportunities of the President to actually go to Congress and ask for supplemental budgets?
HONORABLE MENDOZA:
If there is time to do that, I would say yes.
JUSTICE LEONEN:
So, the theory of aid rather than augmentation applies in extra-ordinary situation?
HONORABLE MENDOZA:
Very extra-ordinary situations.
JUSTICE LEONEN:
But Counsel, this would be new doctrine, in case?
HONORABLE MENDOZA:
Yes, if Your Honor please.190
1. Release of Fund. The amounts authorized herein shall be released only when the revenue collections exceed the original revenue targets submitted by the President of the Philippines to Congress pursuant to Section 22, Article VII of the Constitution, including savings generated from programmed appropriations for the year: PROVIDED, That collections arising from sources not considered in the aforesaid original revenue targets may be used to cover releases from appropriations in this Fund: PROVIDED, FURTHER, That in case of newly approved loans for foreign-assisted projects, the existence of a perfected loan agreement for the purpose shall be sufficient basis for the issuance of a SARO covering the loan proceeds: PROVIDED, FURTHERMORE, That if there are savings generated from the programmed appropriations for the first two quarters of the year, the DBM may, subject to the approval of the President, release the pertinent appropriations under the Unprogrammed Fund corresponding to only fifty percent (50%) of the said savings net of revenue shortfall: PROVIDED, FINALLY, That the release of the balance of the total savings from programmed appropriations for the year shall be subject to fiscal programming and approval of the President.chanroblesvirtuallawlibrary2012 GAA
1. Release of the Fund. The amounts authorized herein shall be released only when the revenue collections exceed the original revenue targets submitted by the President of the Philippines to Congress pursuant to Section 22, Article VII of the Constitution: PROVIDED, That collections arising from sources not considered in the aforesaid original revenue targets may be used to cover releases from appropriations in this Fund: PROVIDED, FURTHER, That in case of newly approved loans for foreign-assisted projects, the existence of a perfected loan agreement for the purpose shall be sufficient basis for the issuance of a SARO covering the loan proceeds.
1. Release of the Fund. The amounts authorized herein shall be released only when the revenue collections exceed the original revenue targets submitted by the President of the Philippines to Congress pursuant to Section 22, Article VII of the Constitution, including collections arising from sources not considered in the aforesaid original revenue target, as certified by the BTr: PROVIDED, That in case of newly approved loans for foreign-assisted projects, the existence of a perfected loan agreement for the purpose shall be sufficient basis for the issuance of a SARO covering the loan proceeds.
TAX REVENUES
Taxes on Net Income and Profits
Taxes on Property
Taxes on Domestic Goods and ServicesGeneral Sales, Turnover or VATSelected Taxes on Services
Selected Excises on Goods
Taxes on the Use of Goods or Property or Permission to Perform Activities
Other Taxes
Taxes on International Trade and Transactions
NON-TAX REVENUES
Fees and Charges
BTR IncomeGovernment ServicesInterest on Bond Holdings
Interest on NG Deposits
Interest on Advances to Government Corporations
Income from InvestmentsGuarantee FeePrivatization
Gain on Foreign Exchange
NG Income Collected by BTrDividends on Stocks
NG Share from Airport Terminal Fee
NG Share from PAGCOR Income
NG Share from MIAA Profit
Foreign Grants
This is to certify that under the Budget for Expenditures and Sources of Financing for 2011, the programmed income from dividends from shares of stock in government-owned and controlled corporations is 5.5 billion.
This is to certify further that based on the records of the Bureau of Treasury, the National Government has recorded dividend income amounting to P23.8 billion as of 31 January 2011.196
This is to certify that the actual dividend collections remitted to the National Government for the period January to March 2012 amounted to P19.419 billion compared to the full year program of P5.5 billion for 2012.197
This is to certify that the actual dividend collections remitted to the National Government for the period January to May 2013 amounted to P12.438 billion compared to the full year program of P10.0198 billion for 2013.
Moreover, the National Government accounted for the sale of the right to build and operate the NAIA expressway amounting to P11.0 billion in June 2013.199
Article 7. Laws are repealed only by subsequent ones, and their violation or non-observance shall not be excused by disuse, or custom or practice to the contrary.
When the courts declared a law to be inconsistent with the Constitution, the former shall be void and the latter shall govern.
Administrative or executive acts, orders and regulations shall be valid only when they are not contrary to the laws or the Constitution.
The decision now on appeal reflects the orthodox view that an unconstitutional act, for that matter an executive order or a municipal ordinance likewise suffering from that infirmity, cannot be the source of any legal rights or duties. Nor can it justify any official act taken under it. Its repugnancy to the fundamental law once judicially declared results in its being to all intents and purposes a mere scrap of paper. As the new Civil Code puts it: ‘When the courts declare a law to be inconsistent with the Constitution, the former shall be void and the latter shall govern.’ Administrative or executive acts, orders and regulations shall be valid only when they are not contrary to the laws of the Constitution. It is understandable why it should be so, the Constitution being supreme and paramount. Any legislative or executive act contrary to its terms cannot survive.
Such a view has support in logic and possesses the merit of simplicity. It may not however be sufficiently realistic. It does not admit of doubt that prior to the declaration of nullity such challenged legislative or executive act must have been in force and had to be complied with. This is so as until after the judiciary, in an appropriate case, declares its invalidity, it is entitled to obedience and respect. Parties may have acted under it and may have changed their positions. What could be more fitting than that in a subsequent litigation regard be had to what has been done while such legislative or executive act was in operation and presumed to be valid in all respects. It is now accepted as a doctrine that prior to its being nullified, its existence as a fact must be reckoned with. This is merely to reflect awareness that precisely because the judiciary is the governmental organ which has the final say on whether or not a legislative or executive measure is valid, a period of time may have elapsed before it can exercise the power of judicial review that may lead to a declaration of nullity. It would be to deprive the law of its quality of fairness and justice then, if there be no recognition of what had transpired prior to such adjudication.
In the language of an American Supreme Court decision: ‘The actual existence of a statute, prior to such a determination [of unconstitutionality], is an operative fact and may have consequences which cannot justly be ignored. The past cannot always be erased by a new judicial declaration. The effect of the subsequent ruling as to invalidity may have to be considered in various aspects, with respect to particular relations, individual and corporate, and particular conduct, private and official.’”
Nonetheless, the minority is of the persistent view that the applicability of the operative fact doctrine should be limited to statutes and rules and regulations issued by the executive department that are accorded the same status as that of a statute or those which are quasi-legislative in nature. Thus, the minority concludes that the phrase ‘executive act’ used in the case of De Agbayani v. Philippine National Bank refers only to acts, orders, and rules and regulations that have the force and effect of law. The minority also made mention of the Concurring Opinion of Justice Enrique Fernando in Municipality of Malabang v. Benito, where it was supposedly made explicit that the operative fact doctrine applies to executive acts, which are ultimately quasi-legislative in nature.In Commissioner of Internal Revenue v. San Roque Power Corporation,211 the Court likewise declared that “for the operative fact doctrine to apply, there must be a ‘legislative or executive measure,’ meaning a law or executive issuance.” Thus, the Court opined there that the operative fact doctrine did not apply to a mere administrative practice of the Bureau of Internal Revenue, viz:chanRoblesvirtualLawlibrary
We disagree. For one, neither the De Agbayani case nor the Municipality of Malabang case elaborates what ‘executive act’ mean. Moreover, while orders, rules and regulations issued by the President or the executive branch have fixed definitions and meaning in the Administrative Code and jurisprudence, the phrase ‘executive act’ does not have such specific definition under existing laws. It should be noted that in the cases cited by the minority, nowhere can it be found that the term ‘executive act’ is confined to the foregoing. Contrarily, the term ‘executive act’ is broad enough to encompass decisions of administrative bodies and agencies under the executive department which are subsequently revoked by the agency in question or nullified by the Court.
A case in point is the concurrent appointment of Magdangal B. Elma (Elma) as Chairman of the Presidential Commission on Good Government (PCGG) and as Chief Presidential Legal Counsel (CPLC) which was declared unconstitutional by this Court in Public Interest Center, Inc. v. Elma. In said case, this Court ruled that the concurrent appointment of Elma to these offices is in violation of Section 7, par. 2, Article IX-B of the 1987 Constitution, since these are incompatible offices. Notably, the appointment of Elma as Chairman of the PCGG and as CPLC is, without a question, an executive act. Prior to the declaration of unconstitutionality of the said executive act, certain acts or transactions were made in good faith and in reliance of the appointment of Elma which cannot just be set aside or invalidated by its subsequent invalidation.
In Tan v. Barrios, this Court, in applying the operative fact doctrine, held that despite the invalidity of the jurisdiction of the military courts over civilians, certain operative facts must be acknowledged to have existed so as not to trample upon the rights of the accused therein. Relevant thereto, in Olaguer v. Military Commission No. 34, it was ruled that ‘military tribunals pertain to the Executive Department of the Government and are simply instrumentalities of the executive power, provided by the legislature for the President as Commander-in-Chief to aid him in properly commanding the army and navy and enforcing discipline therein, and utilized under his orders or those of his authorized military representatives.’
Evidently, the operative fact doctrine is not confined to statutes and rules and regulations issued by the executive department that are accorded the same status as that of a statute or those which are quasi-legislative in nature.
Even assuming that De Agbayani initially applied the operative fact doctrine only to executive issuances like orders and rules and regulations, said principle can nonetheless be applied, by analogy, to decisions made by the President or the agencies under the executive department. This doctrine, in the interest of justice and equity, can be applied liberally and in a broad sense to encompass said decisions of the executive branch. In keeping with the demands of equity, the Court can apply the operative fact doctrine to acts and consequences that resulted from the reliance not only on a law or executive act which is quasi-legislative in nature but also on decisions or orders of the executive branch which were later nullified. This Court is not unmindful that such acts and consequences must be recognized in the higher interest of justice, equity and fairness.
Significantly, a decision made by the President or the administrative agencies has to be complied with because it has the force and effect of law, springing from the powers of the President under the Constitution and existing laws. Prior to the nullification or recall of said decision, it may have produced acts and consequences in conformity to and in reliance of said decision, which must be respected. It is on this score that the operative fact doctrine should be applied to acts and consequences that resulted from the implementation of the PARC Resolution approving the SDP of HLI. (Bold underscoring supplied for emphasis)
Under Section 246, taxpayers may rely upon a rule or ruling issued by the Commissioner from the time the rule or ruling is issued up to its reversal by the Commissioner or this Court. The reversal is not given retroactive effect. This, in essence, is the doctrine of operative fact. There must, however, be a rule or ruling issued by the Commissioner that is relied upon by the taxpayer in good faith. A mere administrative practice, not formalized into a rule or ruling, will not suffice because such a mere administrative practice may not be uniformly and consistently applied. An administrative practice, if not formalized as a rule or ruling, will not be known to the general public and can be availed of only by those with informal contacts with the government agency.
Endnotes:
1 (visited May 27, 2014).
2 Labeled as “Personal Services” under the GAAs.
3 Frequently Asked Questions about the Disbursement Acceleration Program (DAP) (visited May 27, 2014).
4 See note 2.
5 Zero-based budgeting is a budgeting approach that involves the review/evaluation of on-going programs and projects implemented by different departments/agencies in order to: (a) establish the continued relevance of programs/projects given the current developments/directions; (b) assess whether the program objectives/outcomes are being achieved; (c) ascertain alternative or more efficient or effective ways of achieving the objectives; and (d) guide decision makers on whether or not the resources for the program/project should continue at the present level or be increased, reduced or discontinued. (see NBC Circular No. 539, March 21, 2012).
6 Constitutional and Legal Bases < http://www.dbm.gov.ph/?page_id=7364> (visited May 27, 2014).
7Belgica v. Executive Secretary Ochoa, G.R. No. 208566, November 19, 2013.
8 The Villegas petition was originally undocketed due to lack of docket fees being paid; subsequently, the docket fees were paid.
9Rollo (G.R. No. 209287), p. 119.
10 Id. at 190-196. Sec. Abad manifested that the Memorandum for the President dated June 25, 2012 was the directive referred to in NBC No. 541; and that although the date appearing on the Memorandum was June 25, 2012, the actual date of its approval was June 27, 2012.
11 Id. at 523-625.
12 Id. at 627-692.
13 Id. at 693-698.
14 Id. at 699-746.
15 Id. at 748-764.
16 Id. at 766-784.
17 Id. at 925.
18 Id. at 786-922.
19Rollo (G.R. No. 209287), pp. 1050-1051 (Respondents’ Memorandum).
20 Id. at 1044.
21 Id. at 1048.
22 Id. at 1053.
23 Id. at 1053-1056.
24 Id. at 1056.
25 Bernas, The 1987 Constitution of the Republic of the Philippines: A Commentary, 2009 Edition, p. 959.
26 I RECORD of the 1986 Constitutional Commission 436 (July 10, 1986).
27 I RECORD of the 1986 Constitutional Commission, 439 (July 10, 1986).
28 63 Phil. 139 (1936).
29 Id. at 157-158.
30 G.R. No. 153852, October 24, 2012, 684 SCRA 410.
31 Id. at 420-423.
32Municipal Council of Lemery v. Provincial Board of Batangas, No. 36201, October 29, 1931, 56 Phil. 260, 266-267.
33 G.R. No. 163980, August 3, 2006, 497 SCRA 581, 595-596.
34Francisco, Jr. v. Toll Regulatory Board, G.R. No. 166910, October 19, 2010, 633 SCRA 470, 494.
35Planas v. Gil, 67 Phil. 62, 73-74 (1939), with the Court saying:chanRoblesvirtualLawlibraryIt must be conceded that the acts of the Chief Executive performed within the limits of his jurisdiction are his official acts and courts will neither direct nor restrain executive action in such cases. The rule is non-interference. But from this legal premise, it does not necessarily follow that we are precluded from making an inquiry into the validity or constitutionality of his acts when these are properly challenged in an appropriate proceeding. xxx As far as the judiciary is concerned, while it holds “neither the sword nor the purse” it is by constitutional placement the organ called upon to allocate constitutional boundaries, and to the Supreme Court is entrusted expressly or by necessary implication the obligation of determining in appropriate cases the constitutionality or validity of any treaty, law, ordinance, or executive order or regulation. (Sec. 2 [1], Art. VIII, Constitution of the Philippines.) In this sense and to this extent, the judiciary restrains the other departments of the government and this result is one of the necessary corollaries of the “system of checks and balances” of the government established.36Funa v. Villar, G.R. No. 192791, April 24, 2012, 670 SCRA 579, 593. According to Black’s Law Dictionary (Ninth Edition), lis mota is “[a] dispute that has begun and later forms the basis of a lawsuit.”
37 Bernas, op. cit., at 970.
38 Supra note 7.
39 Oral Arguments, TSN of January 28, 2014, p. 14.
40 Id. at 23.
41Funa v. Ermita, G.R. No. 184740, February 11, 2010, 612 SCRA 308, 319.
42Funa v. Villar, supra note 36, at 592; citing David v. Macapagal-Arroyo, G.R. Nos. 171396, 171409, 171485, 171483, 171400, 171489 & 171424, May 3, 2006, 489 SCRA 160, 214-215.
43 Black’s Law Dictionary, 941 (6th Ed. 1991).
44 G.R. No. 191002, March 17, 2010, 615 SCRA 666.
45 Id. at 722-726.
46 G.R. No. 155001, May 5, 2003, 402 SCRA 612, 645.
47Rollo (G.R. No. 209412), Petition, pp. 3-4.
48Rollo (G.R. No. 209164), p. 5.
49Rollo (G.R. No. 209260), p. 6.
50Agan, Jr. v. Philippine International Air Terminals Co., Inc., note 46 at 645.
51 Magtolis-Briones, Leonor, Philippine Public Fiscal Administration, National Research Council of the Philippines and Commission on Audit, 1983, p. 243.
52 Manasan, Rosario G., Public Finance in the Philippines: A Review of the Literature, Philippine Institute for Development Studies Working Paper 81-03, March 1981, p. 37.
53 Magtolis-Briones, op. cit., p. 79.
54 American economist Prof. Philip E. Taylor has tendered the following understanding of the term budget (as quoted in Magtolis-Briones, op. cit., p. 243), to wit:
The budget is the master plan of government. It brings together estimates of anticipated revenues and proposed expenditures, implying the schedule of activities to be undertaken and the means of financing those activities. In the budget, fiscal policies are coordinated, and only in the budget can a more unified view of the financial direction which the government is going to be observed.
55 Id. at 10.
56 Id. at 10-11.
57 Id. at 11.
58 Id. at 12.
59 Manasan, op cit., at. 39; Manasan, Budget Operations Manual Revised Edition, Operations Budget Commission (1968), p. 3.
60 Magtolis-Briones, op cit., at 80.
61 Id.
62 http://www.dbm.gov.ph/?page_id=352. Visited on May 27, 2014.
63 Id.
64 Magtolis-Briones, op cit., p. 269.
65 http://www.dbm.gov.ph/?page_id=352. Visited on March 27, 2014.
66 http://budgetngbayan.com/the-budget-cycle/. Visited on March 27, 2014.
67 http://budgetngbayan.com/budget-101/budget.preparation.
68 Section 22. The President shall submit to the Congress, within thirty days from the opening of every regular session as the basis of the general appropriations bill, a budget of expenditures and sources of financing, including receipts from existing and proposed revenue measures.
69 Section 2(e), P.D. No. 1177 states that capital expenditures « refer to appropriations for the purchase of goods and services, the benefits of which extend beyond the fiscal year and which add to the assets of Government, including investments in the capital of government-owned or controlled corporations and their subsidiaries. »
70 Section 2(d), PD 1177 defines current oprating expenditures as « appropriations for the purchase of goods and services for current consumption or within the fiscal year, including the acquisition of furniture and equipment normally used in the conduct of government operations, and for temporary construction of promotional, research and similar purposes. »
71 Manasan, op.cit., at 32.
72 Id.
73 Id.
74 Id.
75 Id.; see also Banzon Abello, Amelia, Pattern of Philippine Public Expenditures and Revenue, UP Institute of Economic Development and Research, p. 2 (1962).
76 Magtolis-Briones, op.cit., at 383.
77 Id. at 139.
78 Quoted in Banzon Abello, op.cit., at 32-33.
79 Prof. Charles Bastable, a political economist, proposed a similar classification of public revenues in Public Finance (3rd Edition (1917), Book II, Chapter I(2), London: McMillan and Co., Ltd.), to wit:
The widest division of public revenue is into (1) that obtained by the State in its various functions as a great corporation or “juristic person,” operating under the ordinary conditions that govern individuals or private companies, and (2) that taken from the revenues of the society by the power of the sovereign. To the former class belong the rents received by the State as landlord, rent charges due to it, interest on capital lent by it, the earnings of its various employments, whether these cover the expenses of the particular function or not, and finally the accrual of property by escheat or absence of a visible owner. Under the second class have to be placed taxes, either general or special, and finally all extra returns obtained by state industrial agencies through the privileges granted by them.
80 Magtolis-Briones, supra at 140.
81 Id. at 141.
82 Id.
83 Id. at 142.
84 Id.
85 Manual on the New Government Accounting System, Accounting Policies, Volume I, Chapter 1, Section 17 (For National Government Agencies).
86 http://budgetngbayan.com/budget-101/budget-legislation.
87 Article VI of the 1987 Constitution provides:
Section 24. All appropriation, revenue or tariff bills, bills authorizing increase of the public debt, bills of local application, and private bills shall originate exclusively in the House of Representatives, but the Senate may propose or concur with amendments.
88 Section 26, Article VI of the 1987 Constitution, to wit:
Section 26.
1. Every bill passed by the Congress shall embrace only one subject which shall be expressed in the title thereof.
2. No bill passed by either House shall become a law unless it has passed three readings on separate days, and printed copies thereof in its final form have been distributed to its Members three days before its passage, except when the President certifies to the necessity of its immediate enactment to meet a public calamity or emergency. Upon the last reading of a bill, no amendment thereto shall be allowed, and the vote thereon shall be taken immediately thereafter, and the yeas and nays entered in the Journal.
89 Id.
90 Section 27,1, Article VI of the 1987 Constitution, viz:
Section 27.
1. Every bill passed by the Congress shall, before it becomes a law, be presented to the President. If he approves the same he shall sign it; otherwise, he shall veto it and return the same with his objections to the House where it originated, which shall enter the objections at large in its Journal and proceed to reconsider it. If, after such reconsideration, two-thirds of all the Members of such House shall agree to pass the bill, it shall be sent, together with the objections, to the other House by which it shall likewise be reconsidered, and if approved by two-thirds of all the Members of that House, it shall become a law. In all such cases, the votes of each House shall be determined by yeas or nays, and the names of the Members voting for or against shall be entered in its Journal. The President shall communicate his veto of any bill to the House where it originated within thirty days after the date of receipt thereof, otherwise, it shall become a law as if he had signed it.
2. The President shall have the power to veto any particular item or items in an appropriation, revenue, or tariff bill, but the veto shall not affect the item or items to which he does not object.
91 Id.
92 Section 25, 7, Article VI of the 1987 Constitution, thus :
xxxx.
7. If, by the end of any fiscal year, the Congress shall have failed to pass the general appropriations bill for the ensuing fiscal year, the general appropriations law for the preceding fiscal year shall be deemed re-enacted and shall remain in force and effect until the general appropriations bill is passed by the Congress.
xxxx.
93 http://budgetngbayan.com/budget-101/budget-execution.
94 The ABM disaggregates all programmed appropriations for each agency into two main expenditure categories: “not needing clearance” and “needing clearance”; it is a comprehensive allotment release document for all appropriations that do not need clearance, or those that have already been itemized and fleshed out in the GAA.
95 Items identified as “needing clearance” are those that require the approval of the DBM or the President, as the case may be (for instance, lump sum funds and confidential and intelligence funds). For such items, an agency needs to submit a Special Budget Request to the DBM with supporting documents. Once approved, a SARO is issued.
96 Liabilities legally incurred that the Government will pay for.
97Belgica v. Executive Secretary, supra note 7 clarifies the distinction between an NCA and SARO, viz:
A SARO, as defined by the DBM itself in its website, is “[a] specific authority issued to identified agencies to incur obligations not exceeding a given amount during a specified period for the purpose indicated. It shall cover expenditures the release of which is subject to compliance with specific laws or regulations, or is subject to separate approval or clearance by competent authority.” Based on this definition, it may be gleaned that a SARO only evinces the existence of an obligation and not the directive to pay. Practically speaking, the SARO does not have the direct and immediate effect of placing public funds beyond the control of the disbursing authority. In fact, a SARO may even be withdrawn under certain circumstances which will prevent the actual release of funds. On the other hand, the actual release of funds is brought about by the issuance of the NCA, which is subsequent to the issuance of a SARO. xxxx
98 http://budgetngbayan.com/budget-101/budget-accountability.
99 Fisher, Presidential Spending Power, 1975, p. 165.
100 Keefe and Ogul, The American Legislative Process: Congress and the States, 1993, p. 359.
101 Magtolis-Briones, op. cit., p. 79.
102 Diokno, Philippine Fiscal Behavior in Recent History, The Philippine Review of Economics, Vol. XLVII, No. 1, June 1, 2010, p. 53.
103 World Bank, Philippines Quarterly Update: Solid Economic Fundamentals Cushion External Turmoil, available at http://www.investphilippines.info/arangkada/wp-content/uploads/2011/10/WB-Philippines-Quarterly-Update-Sept2011.pdf (last accessed March 31, 2014).
104 Id.
105 Department of Budget and Management, Frequently Asked Questions About the Disbursement Acceleration Program (DAP), available at http://www.dbm.gov.ph/?page_id=7362 (last accessed, December 3, 2013).
106 Respondent’s Consolidated Comment, p.8.
107 Public-Private Partnership.
108 Philippines Quarterly Update: Solid Economic Fundamentals Cushion External Turmoil, available at http://www.investphilippines.info/arangkada/wp-content/uploads/2011/10/WB-Philippines-Quarterly-Update-Sept2011.pdf (last accessed March 31, 2014).
109 Respondent’s Memorandum, p. 2, citing the Philippines Quarterly Update: From Stability to Prosperity for All, available at http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/ 2012/06/12/000333037_20120612011744/Rendered/PDF/698330WP0P12740ch020120FINAL0051012.pdf (last accessed March 31, 2014).
110 The research group IBON International contests this finding, saying that the contribution of the DAP spending was only one-fourth of a percentage point at most during the last quarter of 2011, and a “negligible fraction” for the entire year of 2011. See “DAP did not contribute 1.3 percentage points to growth—IBON,” available at http://ibon.org/ibon_articles.php?id=344 (last accessed April 5, 2014).
111 TSN, Oral Arguments, January 28, 2014, p. 12.
112 Diokno, Philippine Fiscal Behavior in Recent History, The Philippine Review of Economics, Vol. XLVII, No. 1, June 1, 2010, p. 51.
113 Id. at 52.
114Rollo (G.R. No. 209287), p. 539, (Respondent’s 1st Evidence Packet).
115 Id. at 526-529, (Respondent’s 1st Evidence Packet).
116 Id. at 537-540.
117 Id. at 549-555.
118 Id. at 563-568.
119 Id. at 579-587.
120 Id. at 601-608.
121 This memorandum was a request to fund the rehabilitation plan for the Typhoon Pablo-stricken areas in Mindanao amounting to P10.534 billion to be sourced from the (i) 2012 and 2013 pooled savings from programmed appropriations, and (ii) revenue windfall collections during the first semester comprising the 2013 Unprogrammed Fund, Respondent’s 1st Evidence Packet, p. 609-B.
122Rollo (G.R. No. 209287), p. 555, (Respondent’s 1st Evidence Packet).
123 Id. at 185-189, (Respondent’s Manifestation dated December 6, 2013).
124 Blacks’ Law Dictionary (6th Ed.) p. 102.
125 G.R. No. 29627, December 19, 1989, 180 SCRA 254.
126 Id. at 160.
127 Daniel Tomassi, “Budget Execution,” in Budgeting and Budgetary Institutions, ed. Anwar Shah (Washington: The International Bank for Reconstruction and Development/World Bank, 2007), p. 279, available at http://siteresources.worldbank.org/PSGLP/Resources/BudgetingandBudgetaryInstitutions.pdf (last accessed April 9, 2014).
128 Budget Operations Manual (Revised Edition) 1968, Office of the President, Budget Commission.
129 Fujitani and Shirck, Executive Spending Powers: The Capacity to Reprogram, Rescind, and Impound. Harvard Law School, Federal Budget Policy Seminar, Briefing Paper No. 8, p. 1, available at http://www.law.harvard.edu/faculty/hjackson/ExecutiveSpendingPowers_8.pdf (last accessed December 3, 2013).
130 Id. at 8.
131 Id.
132 Princeton University Press, 1975, pp. 261-262.
133 G.R. No. 103524, April 15, 1992, 208 SCRA 133, 150.
134 Waldby, Odell, Philippine Public Fiscal Administration, Institute of Public Administration, University of the Philippines, 1954, p. 319.
135 The Philippine Commission, which lasted from 1900 to 1916, comprised the Upper House of the Philippines Legislature. The Philippine Assembly, which existed from 1907 to 1916, served in its time as the Lower House of the Philippine Legislature.
136 Waldby, op. cit., pp. 321-322.
137 In his Sponsorship Speech, Delegate Honesto Mendoza, the Chairman of the Committee on Budget and Appropriations of the 1971 Constitutional Convention, stated that it was deemed “absolutely necessary to remove the anomaly of illegal fund transfers of public funds to projects or purposes not contemplated by law.”
138 Minutes of the Meeting, Commission on Budget and Appropriations, 1971 Constitutional Convention, November 4, 1971, p. 18.
139 Minutes of the Meeting, Commission on Budget and Appropriations, 1971 Constitutional Convention, January 13, 1972, p. 10.
140 Id. at 9.
141 Id. at 10-11.
142Demetria v. Alba, No. L-71977, February 27, 1987, 148 SCRA 208.
143 Id. at 214-215.
144 G.R. No. 188635, January 29, 2013, 689 SCRA 385, 402-404.
145 Constitutional and Legal Bases < http://www.dbm.gov.ph/?page_id=7364> (visited March 27, 2014)
146Rollo (G.R. No. 209442), p. 7.
147Rollo (G.R. No. 209260), p. 17; (G.R. No. 209517), p. 19; (G.R. No. 209155), p. 11; (G.R. No. 209135), p. 13.
148Rollo (G.R. No. 209287), p. 6; (G.R. No. 209517), p. 19; (G.R. No. 209442), p. 23.
149 Section 17, Article VII of the 1987 Constitution provides:
Section 17. The President shall have control of all the executive departments, bureaus, and offices. He shall ensure that the laws be faithfully executed.
150Sanchez v. Commission on Audit, G.R. No. 127545, April 23, 2008, 552 SCRA 471, 497.
151 NBC No. 541 (Rationale); see also NBC No. 541 (5.3), which stated that, in case of failure to submit budget accountability reports, the DBM would compute/approximate the agency’s obligation level as of June 30 to derive its unobligated allotments as of the same period.
152 NBC No. 541 (2.1).
153 NBC No. 541 (5.7.1).
154 These GAA provisions are reflected, respectively, in NBC No. 528 (Guidelines on the Release of funds for FY 2011), thus:
3.9.1.2 Appropriations under FY 2011 GAA, R.A. 10147 shall be available for release and obligations up to December 31, 2012 with the exception of PS which shall lapse at the end of 2011.
and NBC No. 535 (Guidelines on the Release of funds for FY 2012), thus:
3.9.1.2 Appropriations under CY 2012 GAA, R.A. 10155 shall be available for release and obligations up to December 31, 2013 with the exception of PS which shall lapse at the end of 2012.
155Rollo (G.R. No. 209442), p. 23.
156Rollo (G.R. No. 209287), p. 1060, (Memorandum for the Respondents).
157Rollo (209287), pp. 18-19.
158Rollo (209442), pp. 21-22.
159 G.R. No. 113105, August 19, 1994, 235 SCRA 506, 545.
160 Webster’s Third New International Dictionary.
161 TSN, January 28, 2014, p. 12.
162 DBM, “Sec. Abad: DAP used to buoy spending, not to buy votes,” available at http://www.dbm.gov.ph/?p=7328 (last accessed March 28, 2014).
163 DBM, “Sec. Abad: DAP used to buoy spending, not to buy votes,” available at http://www.dbm.gov.ph/?p=7328 (last accessed March 28, 2014).
164Rollo (G.R. No. 209136), p. 18.
165Rollo (G.R. No. 209136), p. 18; (G.R. No. 209442), p. 13.
166Rollo (G.R. No. 209155), p. 9.
167Rollo (G.R. No. 209287), pp. 68-104; (Respondents’ Consolidated Comment).
168Rollo (G.R. No. 209287), pp. 524-922.
169 SARO No. E-11-02253; Rollo (G.R. No. 209287), p. 628, (Respondents’ 2nd Evidence Packet).
170 See FY2011 National Expenditure Program, p. 1186, available at http://www.dbm.gov.ph/wp-content/uploads/NEP2011/DOSTG-GAA.pdf.
171 SARO No. E-14-02254; Rollo (G.R. No. 209287), p. 630, (Respondents’ 2nd Evidence Packet).
172Rollo (G.R. No. 209287), p. 27, (Respondents’ Memorandum).
173 TSN, January 28, 2014, p. 26.
174 Section 29(1), Article VI of the 1987 Constitution provides that no money shall be paid out of the Treasury except in pursuance of an appropriation made by law.
175 According to Allen and Miller. The Constitutionality of Executive Spending Powers, Harvard Law School, Federal Budget Policy Seminar, Briefing Paper No. 38, p. 16, available at http://www.law.harvard.edu/faculty/hjackson/ConstitutionalityOfExecutive_38.pdf (December 3, 2013):
If the executive could spend under its own authority, “then the constitutional grants of power to the legislature to raise taxes and to borrow money would be for naught because the Executive could effectively compel such legislation by spending at will. The ‘[L]egislative Powers’ referred to in section 8 of Article I would then be shared by the President in his executive as well as in his legislative capacity” The framers intended the powers to spend and the powers to tax to be “two sides of the same coin,” and for good reason. Separating the two powers — or giving the President one without the other — might reduce accountability and result in excessive spending: the President would be able to spend and leave Congress to deal with the political repercussions of financing such spending through heightened tax rates.
176 Bernas, op. cit., at 811.
177 Wander and Herbert (Ed.), Congressional Budgeting: Politics, Process and Power (1984), p. 3.
178 Wander and Herbert (Ed.), Congressional Budgeting: Politics, Process and Power (1984), at 133.
179 Bernas, op. cit., at 812.
180Philippine Constitution Association v. Enriquez, supra, note 159, at 522.
181 Stith, Kate, “Congress’ Power of the Purse” (1988), Faculty Scholarship Series, Paper No. 1267, p. 1345, available at http://digitalcommons.law.yale.edu/cgi/viewcontent.cgi?article=2282&context=fss_papers (last accessed March 29, 2014).
182 Id. at 1377.
183 TSN of January 28, 2014, pp. 42-45.
184Rollo (G.R. No. 209287), p. 883, (Respondents’ 7th Evidence Packet).
185 Id. at 562, (Respondents’ 1st Evidence Packet).
186 See the OSG’s Compliance dated February 14, 2014, Annex B, p. 2.
187Rollo (G.R. No. 209287), p. 35, (Memorandum for the Respondents).
188 Id.
189 TSN of February 18, 2014, p. 32.
190 TSN of February 18, 2014, pp. 45-46.
191Rollo (G.R. No. 209287), p. 1027; (G.R. No. 209442), p. 8.
192 Other References: A Brief on the Special Purpose Funds in the National Budget (visited May 2, 2014).
193Rollo (G.R. No. 209287), p. 95.
194 Glossary of Terms, BESF.
195 TSN, January 28, 2014, p. 106.
196Rollo (G.R. No. 209155), pp. 327 & 337.
197 Id. at 337 & 338.
198 The target revenue for dividends on stocks of P5.5 billion was according to the BESF (2013), Table C.1 Revenue Program, by Source 2011-2013.
199Rollo (G.R. No. 209155), pp. 337 & 339.
200 Other References: A Brief on the Special Purpose Funds in the National Budget (visited May 2, 2014).
201 Basic Concepts in Budgeting (visited May 2, 2014).
202 Id.
203 The Equal Protection Clause is found in Section 1, Article III of the 1987 Constitution, to wit:Section 1. No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws.204 Article XI of the 1987 Constitution states:Section 1. Public office is a public trust. Public officers and employees must, at all times, be accountable to the people, serve them with utmost responsibility, integrity, loyalty, and efficiency; act with patriotism and justice, and lead modest lives.205 See Fariñas v. Executive Secretary, G.R. No. 147387, December 10, 2003, 417 SCRA 503.
206Commissioner of Internal Revenue v. San Roque Power Corporation, G.R. No. 187485, October 8, 2013.
207 G.R. No. L-23127, April 29, 1971, 38 SCRA 429, 434-435.
208Yap v. Thenamaris Ship’s Management, G.R. No. 179532, May 30 2011, 649 SCRA 369, 381.
209League of Cities Philippines v. COMELEC, G.R. No. 176951, August 24, 2010, 628 SCRA 819, 833.
210 G.R. No. 171101, November 22, 2011, 660 SCRA 525, 545-548.
211Commissioner of Internal Revenue v. San Roque Power Corporation, G.R. No. 187485, October 8, 2013.
212 This view is similarly held by Justice Leonen, who asserts in his separate opinion that the application of the doctrine of operative fact should be limited to situations (a) where there has been a reliance in good faith in the acts involved, or (b) where in equity the difficulties that will be borne by the public far outweigh the rigid application of the legal nullity of an act.