8. Powers Relative to Appropriation Measures

Powers Relative to Appropriation Measures

1987 CONST., art. VI, secs. 25(5) and 27(2); art. VII, sec. 20

> Art. VI, Sec. 25 (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. Art. VI, Sec. 27 (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. Art. VII, SECTION 20. The President may contract or guarantee foreign loans on behalf of the Republic of the Philippines with the prior concurrence of the Monetary Board, and subject to such limitations as may be provided by law. The Monetary Board shall, within thirty days from the end of every quarter of the calendar year, submit to the Congress a complete report of its decisions on applications for loans to be contracted or guaranteed by the Government or government-owned and controlled corporations which would have the effect of increasing the foreign debt, and containing other matters as may be provided by law.

ITEM VETO POWER on the basis of:

Doctrine of Inappropriate Provisions - A provision that is constitutionally inappropriate for an appropriation bill may be subject to veto even if it is not an appropriation or revenue “item.”

Executive Impoundment - Refusal of the President to spend funds already allocated by Congress for a specific purpose. It is, in effect, an “impoundment” of the law allocating such expenditure of funds.

Budget – The Executive Branch proposes a budget to Congress, which the latter considers in drafting appropriation laws.

Updated: An appropriation item is the last and indivisible purpose of a program, not a mere expense category, and specific line-items in the Details of the Budget may qualify as items (Dela Cruz v. Ochoa, G.R. No. 219683, 23 January 2018).

Limits on Power to Appropriate

The Congress may not increase the appropriations recommended by the President for the operation of the Government as specified in the budget. The form, content, and manner of preparation of the budget shall be prescribed by law (PHIL. CONST. § 25 (1)).

What are the requisites for a valid transfer of appropriation?

There are two essential requisites for an augmentation authorized by law under Article VI, Section 25(5) of the 1987 Constitution. First, there must be actual savings from other items of the authorized official’s respective appropriations. Second, there must be an existing item in the general appropriations law for that official’s respective office to be augmented; augmentation across agencies is not authorized. (Sanchez v. COA, 552 SCRA 471)

Actual savings is a sine qua non to a valid augmentation of an existing item within the authorized official’s respective office under Article VI, Section 25(5) of the 1987 Constitution. The word “actual” denotes that something is real or substantial, or exists presently in fact as opposed to something which is merely theoretical, possible, potential or hypothetical. (Sanchez v. COA, 552 SCRA 471)

Prohibition on “Riders” in Appropriation Bills

No provision or enactment shall be embraced in the general appropriations bill unless it relates specifically to some particular appropriation therein. Any such provision or enactment shall be limited in its operation to the appropriation to which it relates. (PHIL. CONST. § 25 (2)).

A provision which refers to the fundamental government policy matters of the calling to active duty and the reversion to inactive status of reserve officers in the AFP is a non-appropriation item inserted in an appropriation measure and is a violation of the constitutional inhibition against “riders” to the General Appropriations Act (GAA) (Garcia v Mata, G.R. No. L-33713 July 30, 1975).

For a provision in the general appropriations bill, Article VI, Section 25(2) requires that it relate specifically to a particular appropriation therein and be limited in operation to that appropriation. Fariñas’s liberal title-and-subject discussion addresses a different constitutional requirement (Fariñas v Executive Secretary; G.R. No. 147387, 2003).

Preparing and Submitting the Budget

SECTION 22, ARTICLE VII. The President shall submit to the Congress within thirty (30) 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.

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The budget is the plan indicating:

• Expenditures of the government;
• Sources of financing; and
• Receipts from revenue-raising measures. Congress may not increase the appropriations recommended by the President for the operation of the Government as specified in the budget. Through the budget, therefore, the President reveals the priorities of the government.

As to certain laws

Appropriations Laws – Created to regulate spending

SECTION 22, ARTICLE VII. 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.

SECTION 24, ARTICLE VI. 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.

SECTION 25, ARTICLE VI. (1) The Congress may not increase the appropriations recommended by the President for the operation of the Government as specified in the budget. The form, content, and manner of preparation of the budget shall be prescribed by law.

(2) No provision or enactment shall be embraced in the general appropriations bill unless it relates specifically to some particular appropriation therein. Any such provision or enactment shall be limited in its operation to the appropriation to which it relates.

(3) The procedure in approving appropriations for the Congress shall strictly follow the procedure for approving appropriations for other departments and agencies.

(4) A special appropriations bill shall specify the purpose for which it is intended, and shall be supported by funds actually available as certified by the National Treasurer, or to be raised by a corresponding revenue proposal therein.

(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.

(6) Discretionary funds appropriated for particular officials shall be disbursed only for public purposes to be supported by appropriate vouchers and subject to such guidelines as may be prescribed by law.

(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 reenacted and shall remain in force and effect until the general appropriations bill is passed by the Congress.

SECTION 29(1), ARTICLE VI. No money shall be paid out of the Treasury except in pursuance of an appropriation made by law.

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Doctrine of Inappropriate Provision

A provision that is constitutionally inappropriate for an appropriation bill may be singled out for veto even if it is not an appropriation or revenue item.