Did the President usurp Congress’ power?

TWENTY-EIGHT years after EDSA 1, our national leaders have yet to learn to uphold and protect the 1987 Constitution. Many do so only when it is convenient, but boldly ignore it when inconvenient.

That was my concluding remark in my presentation to the 11th Ambassador Alfonso T. Yuchengco Policy Conference held at Mandarin Oriental Hotel at Makati City on Feb. 10.

I talked on the topic "Pork Barrel, PDAF, and DAP: What’s the Real Score?"

The core issues on the topic are: separation of powers and encroachment and/or usurpation of powers by either Congress or the President. On the separation of powers, the President prepares and executes the budget, Congress authorizes it, and the Supreme Court interprets the law in the event of disagreement between the two branches of government.

On the Priority Development Assistance Fund (PDAF), the issue is whether Congress has exercised the presidential power of budget implementation. On other funds (the Malampaya Fund, the Pagcor Fund) and the Disbursement Acceleration Program (DAP), the issue is whether the President has usurped the power of Congress to authorize appropriations and whether he has abused the power to augment items in the general appropriations act (GAA).

On PDAF, the Supreme Court ruled that it is unconstitutional because "it has allowed legislators to wield, in varying gradations, non-oversight, post-enactment authority in vital areas of budget execution."

The Malampaya Fund was declared unconstitutional "insofar as it has conferred to the President the power to appropriate funds intended by law for energy-related purposes only to other purpose he may deem fit."

The Pagcor Fund was declared unconstitutional because it has expanded in its use the broad classification of "priority infrastructure development project." This violated the principle of "non-delegability," the Supreme Court ruled. Congress cannot delegate to the President its power to authorize appropriations.

In sum, the Supreme Court ruled unanimously that PDAF and aspects of the Malampaya Fund and Pagcor Fund are unconstitutional.

THE PRESIDENT HAS USURPED THE CONGRESSIONAL POWER OF THE PURSE
The Supreme Court ruled that PDAF is unconstitutional because it allowed legislators to exercise post-enactment authority in budget execution. By contrast, the DAP has allowed the President to usurp the congressional power of the purse. The President, halfway through the implementation of the budget, has declared savings on slow-moving projects, "confiscated and reassembled" them and used the same to finance projects that were non-existent in the GAA.

The core issues in the DAP are the following:

• Was there transfer of appropriations?

• Was there real saving(s)?

• Was the augmentation process appropriately done? Specifically, were the conditions for augmentation specified in the Constitution and other laws strictly observed and complied with?

The 1987 Constitution prohibits any law authorizing any transfer of appropriations. Article VI, Section (5) provides: 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, 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.

Yes, Angelina, the word "realignment" was never used in the Constitution; instead, the term "augment" was used. And the augmentation has to come "from savings in other items of their respective appropriations" for application to items in the GAA "for their respective offices."

From the above provisions of the Constitution and other laws, the following conditions for augmentation should hold:

• There are actual savings declared as defined in the GAA to be transferred.

• The item(s) to be augmented by the saving(s) exist in the GAA are "determined deficient."

• The source(s) of savings and the item(s) to be augmented must be within the appropriations of the authorized official.

• "In no case shall a non-existent program, activity or project, be funded by augmentation from savings or by the use of appropriations authorized in this Act."

‘CROSS-BORDER’ AUGMENTATION IS UNCONSTITUTIONAL
With the above test of augmentation, the following "cross-border" -- a term used by some Supreme Court justices -- augmentation is unconstitutional:

From the national government (NG) to the Commission on Audit (COA). The Department of Budget and Management (DBM), through the DAP, augmented out the budget of the COA. On Nov. 16, 2013, in a Senate Hearing, the COA Chairman admitted that in 2012, the COA received P140 million for the funding of computers, hiring of consultants and purchase of vehicles for Commissioners/Directors. Source of funding: DAP 2012.

From the NG to the House of Representatives (HOR). DBM, through the DAP, augmented the budget of the House of Representatives.

From the NG to the Commission on Elections. Using "overall" savings, the DBM augmented the budget of the Commission on Elections.

These three examples of "cross-border" augmentation of the budget are patently unconstitutional. During the oral argument before the Supreme Court, Budget Secretary Abad did not deny these three transactions.

All told, DAP financed 119 separate budget activities costing P149 billion. The releases took place from the fourth quarter of 2011 to the second quarter of 2013.

THE DAP IS DEAD. SERIOUSLY?
The DAP is dead, according to Budget Secretary Abad and Solicitor General Jardeleza. No harm, no foul. The issue is moot and academic.

False, false, and false. The DAP maybe resurrected anytime by the sitting President or by his successors. The harm has been done. The President has usurped the legislative power of the purse. He and his Budget Secretary have disrespected the members of Congress, the people’s representatives.

The DAP has significantly altered the balance of power envisioned in the 1987 Constitution. The allocation of power is a zero-sum game: when one branch of the government is strengthened, another branch is weakened.

Funds, using fuzzy savings, were disbursed for programs, projects and activities that were not even authorized by Congress. Put differently, public funds were used without congressional authorization. Yet, the Constitution is very clear: no money shall be paid out of the Treasury except in pursuance of an appropriation made by law.

The DAP issue is neither moot nor academic, as government authorities would like all Filipinos to accept. Quite frankly, I find their position insulting. Their lack of remorse is despicable. After squandering billions of taxpayers’ money, these public officials, our servants, would like us, their bosses, to forget the whole mess.

Just like PDAF, DAP can rise again from the dead, many times over. Hence, the Supreme Court should put a permanent stop to it and its many variants.

The case against the DAP is for posterity. It is not about the sitting President alone; it is for future Presidents too. If the DAP were allowed to hibernate, rather than be totally exterminated, the future of this country will be very bleak indeed.

(The author is Professor of Economics at the UP School of Economics and former Secretary of Budget and Management. )

source:  Businessworld

When is HRET Jurisdiction begins and COMELEC's ends?

Reyes v. COMELEC, June 25, 2013, G.R. No. 207264 

 

In Vinzons-Chato v. COMELEC, citing Aggabao v. COMELEC and Guerrero v. COMELEC, the Court ruled that:

The Court has invariably held that once a winning candidate has been proclaimed, taken his oath, and assumed office as a Member of the House of Representatives, the COMELEC’s jurisdiction over election contests relating to his election, returns, and qualifications ends, and the HRET’s own jurisdiction begins. (Emphasis supplied.)

This pronouncement was reiterated in the case of Limkaichong v. COMELEC, wherein the Court, referring to the jurisdiction of the COMELEC vis-a-vis the HRET, held that:

The Court has invariably held that once a winning candidate has been proclaimed, taken his oath, and assumed office as a Member of the House of Representatives, the COMELEC's jurisdiction over election contests relating to his election, returns, and qualifications ends, and the HRET's own jurisdiction begins. (Emphasis supplied.)

This was again affirmed in Gonzalez v. COMELEC, to wit:

After proclamation, taking of oath and assumption of office by Gonzalez, jurisdiction over the matter of his qualifications, as well as questions regarding the conduct of election and contested returns – were transferred to the HRET as the constitutional body created to pass upon the same. (Emphasis supplied.)

From the foregoing, it is then clear that to be considered a Member of the House of Representatives, there must be a concurrence of the following requisites: (1) a valid proclamation, (2) a proper oath, and (3) assumption of office.

xxx

Here, the petitioner cannot be considered a Member of the House of Representatives because, primarily, she has not yet assumed office. To repeat what has earlier been said, the term of office of a Member of the House of Representatives begins only “at noon on the thirtieth day of June next following their election.” Thus, until such time, the COMELEC retains jurisdiction.

 

Pork barrel 101

Under the doctrine of separation of powers, Congress shall enact laws, the president shall execute them, and the Supreme Court shall interpret them. This delineation of authority is exclusive and absolute and the three great branches of government cannot intrude into each other’s exclusive domain.

Basic doctrine. Consequently, the president cannot make laws, except when the Constitution is abrogated, like during the martial-law era when Ferdinand Marcos ruled by issuing presidential decrees, or like during the revolutionary government in 1986-1987 when Cory Aquino issued executive orders that were the equivalent of laws. Unless subsequently repealed or modified by the legislature, these decrees and orders are still valid up to now.

By the same token, the Supreme Court cannot legislate or implement laws; it can only interpret them. It can invalidate laws but it cannot create new ones. Judicial legislation is anathema to the Constitution.
Likewise, Congress cannot interpret with finality the meaning of the laws it passes. Neither can legislators implement them, nor participate in their implementation. Unconstitutional would be a law that empowers members of Congress (1) to specify what projects should be undertaken, and/or (2) to determine what offices or organizations should be given government funds from an appropriated lump sum to implement these projects.

Change in facts. In the past, legislators were not given by law any of these two prerogatives. They merely “recommended” the projects to the executive agencies. Hence, in 1994, the Supreme Court held that the pork barrel system was constitutional since the legislators were not empowered by the then prevailing law to determine the projects to be implemented. They merely recommended the projects to the executive offices, which retained the absolute discretion to accept or reject these recommendations.
In the case now pending in the Supreme Court, the contentious point is whether the present law requires the executive agencies to implement the projects that the legislators chose through the nongovernment organization (NGO) they select. Otherwise stated, is the “recommendation” of the legislators binding? If so, then the law would be unconstitutional because it authorizes the lawmakers to participate in the law’s implementation.

The 1994 precedent would not apply because it had a different factual setting: Under the then law, the lawmaker’s recommendation was not binding. A difference in facts produces a different ruling. “Stare  decisis” or stability of precedents would not apply when the facts change.

On the other hand, legislators may include in the law itself the specific projects to be undertaken (like a university or hospital) or to be built (like a bridge, port or highway) without violating separation of powers. Thus, Congress can validly pass a law describing in the law itself the specific projects and the source for funding them. This would not violate the Constitution because the legislators would not have post-enactment power to interfere in the law’s implementation.

What is prohibited is a law appropriating a lump sum and at the same time empowering the legislators individually to dictate the specific projects to be funded from the lump sum. This is what may make the present pork barrel law invalid: Legislators are given the power to interfere by choosing (1) what specific projects would be funded from the lump sum, and (2) which executive agency or NGO would undertake the projects. 

How to abolish pork. More reprehensible is the downright misuse of the pork funds. According to media reports, releases from the lump-sum appropriations were diverted, at the alleged direction of some legislators, to NGOs which however did not undertake the projects. Simply stated, the funds were given to bogus NGOs and for ghost projects. Misuse of pork funds is not only unconstitutional; it is criminal. The scammers should be punished.

Who can abolish pork barrel? Answer: the Supreme Court, by declaring the law unconstitutional. Or Congress, by eliminating (1) the lump-sum appropriation and (2) the legislators’ power to direct the use of the lump sum via their chosen agencies or NGOs.

Hospitals, bridges, roads, scholarships, emergency aid, etc. can still be funded through and implemented by the line executive agencies. That is how it should be: The legislators make the law and the executive agencies implement it without any interference by the lawmakers.

Can it be abolished by a people’s initiative? The Supreme Court, in Lambino vs. Comelec (Oct. 25, 2006, penned by Justice Antonio T. Carpio during my term as chief justice), restricted the use of initiative to simple “amendments,” not to complicated “revisions” requiring debate and deliberation. As to whether the pork’s abolition is a simple amendment or a complicated revision could be debated ad  infinitum  and would surely end up in the courts.

Besides, initiative is a tedious process. It requires the signatures of at least 12 percent of the 50 million voters and of at least three percent of the voters in each of the 234 legislative districts; favorable action by the Commission on Elections; and a referendum by the people, all of which will take at least a year. Longer, if the matter is raised to the Supreme Court, as was done in previous initiatives.

In short, the unconstitutionality route, or congressional repeal, would be less convoluted and much faster. If these two solutions are ignored, it is time for another Edsa.
* * *

Comments to chiefjusticepanganiban@hotmail.com

source: Philippine Daily Inquirer Column of CJ Artemio Panganiban

TRANSFER OF FUNDS: Can the DAP be saved?

This afternoon, the Supreme Court once again hears a controversial case, this time on the constitutionality and legality of the Disbursement Acceleration Program of the Aquino government. A formidable group of petitioners and their counsels will argue the case against the DAP. These includes, among others, the Philippine Constitutional Association, distinguished public finance experts like former Budget Secretary Benjamin Diokno and former National Treasurer Leonor Briones, and individuals and groups from the progressive political coalition Makabayan. The Solicitor General and his team of excellent lawyers will of course take the cudgels for the administration.

The stakes are higher for the Aquino administration and the country in this case, much higher, I suspect, than the PDAF case argued a couple of weeks ago. In that case, what was at stake was simply the funding of projects of legislators. In that case too, there was a clear legal basis in the General Appropriations Act in the PDAF disbursements.

In the DAP, we are talking of much larger expenditures and for projects of much higher priority than the pet projects of the legislators. In addition, the DAP is not in the GAA or any law, not even in an executive or other presidential order, and its sole justification is the constitutional provision that allows the president to augment from savings other appropriated items.

Turning now to its legality, as I have observed before, the weight of legal opinion seems to be for its unconstitutionality. Senator Miriam Defensor Santiago has pointed out that the Constitution “allows fund transfers, only if there are savings, meaning that the project was completed, and yet the appropriation was not exhausted; but there are no savings if a project was merely deferred.” She observed that it appeared that DAP funds were taken from alleged slow-moving projects. “If so, no savings were generated, and therefore DAP is illegal.”

Disagreeing with Santiago, Ateneo Law Professor Mel Sta. Maria, in an opinion piece for the TV5 website, argues that the DAP is nothing else but the disbursement of funds sourced from savings of a particular item to fund a deficit in another item for the purpose of immediately accomplishing a priority activity. This makes the DAP legal and constitutional. In his words: “The only transfer that cannot be made in this process is a transfer of saved-funds from one great government department to another. Hence, the President cannot transfer executive funds to the judiciary, the judiciary to the executive, the judiciary to the legislature, the legislature to the executive, the executive to the legislature. To do so would be unconstitutional. But within the executive branch, which is composed of so many departments, the President may do so pursuant to the Constitution and the Administrative Code. In fact, the Constitution also explicitly grants the Chief Justice, the Senate President, the Speaker of the House, the head of Constitutional bodies the same powers within their departments.”

Fr. Joaquin Bernas SJ, in an interview with ANC, seems to agree with Santiago asserting that savings should only be spent to augment existing line items in the budget. Bernas also identified the enabling conditions for realigning savings. “One, you have to have savings. Two, if these savings are to be transferred, they have to be transferred in the same department.” Later, in his column in the Philippine Daily Inquirer, Fr. Bernas observed that “the outcome of the controversy on the DAP will depend on the answer to factual questions:  Did he transfer ‘savings’ and where did he put them?”

I think Fr. Bernas asks the right questions that must be answered in the affirmative if the DAP is to survive constitutional scrutiny. More concretely, I would ask: Are funds transferred in the middle of the year “savings” because of slow-moving projects constitute savings? And, were the projects augmented funded by and already identifies the GAA?

As for me, in the case of DAP disbursement decisions made purely by the executive branch, there is a color of legality precisely because the President has the power to realign savings. I think however that it would have been more prudent if the President issued an executive order or other presidential issuance that established the DAP. Without that, the administration has been able to communicate its message clearly and effectively, leaving even its supporters confused about  the DAP. In fact if the administration intends to continue with this approach in disbursement, particularly in response to the recent disaster in Zamboanga and Bohol, then they should issue such an executive order. However, I would counsel that it completely abandon the term “DAP” as it has become so tainted and controversial that it cannot be rehabilitated. All political analysts and communicators know that the best way to end a controversy is to change the conversation.

As to DAP disbursements that were made upon recommendation by senators and other legislators, I believe that these were illegal and in the case of the senators clearly improper.
In the case of the PDAF, there is a presumption of constitutionality because of the GAA and the prior Supreme Court decisions. But in the case of the DAP, there is no legal basis at all for allowing the legislators to identify projects. Corruption also tainted DAP disbursements because, as in the case of the PDAF, the legislators were allowed to cross the line with respect to implementation.

As for the Senators, from an ethical point of view, given the context of the Corona conviction, allowing the senators to identify even more projects than they already did with their PDAF reeks of quid pro quo. It may not be criminal or impeachable bribery but it definitely does not look or smell right.
Can the DAP be saved? The better question I think  is – should it be?

Facebook: Dean Tony La VinaTwitter: tonylavs

source:  Manila Standard Column of

People's Initiative vs PDAF

Why People’s Initiative is doomed

When retired Chief Justice Reynato Puno suggested that the people should take the route of People’s Initiative as mandated by the 1987 Constitution, or by a Republic Act to have the pork barrel system totally abolished, there were some reservations.

These reservations came with good reason. The process is a long and tedious one.
First of all, if the people themselves take the mode of amending the Constitution to have the pork barrel system abolished, there must be a petition of at least 12 percent of the total number of registered voters, of which every legislative district must be represented by at least 3 percent of the registered voters therein.
A republic act requires only 10 percent of the total number of registered voters nationwide with the same percent of 3 percent of every legislative district.

My gulay, even if only one legislative district is not able to comply, the People’s Initiative is doomed!
Since the initiative would deprive legislators of their pork barrel where commissions, rebates and kickbacks abound, that means the greedy lawmakers would campaign against it in their legislative districts. In many districts nationwide, there are command votes dependent on how much and how far a congressman or senator can spread the gravy.

Those who agree with Puno’s proposal have to agree on which route to take—the constitutional mode, or the Republic Act. Since we have a President who doesn’t like to touch the 1987 Constitution framed during his late mother’s term, taking the constitutional route is far-fetched. Thus, we are left with the law on People’s Initiative. But that also is steeped with land mines since a lawmaker who doesn’t want his pork barrel abolished can easily campaign against it.

There is also the need to decide what amendment in the Constitution must be made or what law must be enacted. In the United States where People’s Initiative is prevalent, they call it “Proponent” or “Proposal.” It’s easier there to have the initiative prevail because it’s a federal system of government where every state has its own Congress.

And if the required number of signatures is taken, they must also be verified by the Comelec, after which a referendum will be called for that purpose.
People’s Initiative under the Constitution or by law is doable, but it’s impractical under our system of government.

So, what else can we, the people, do, but continue mounting protests nationwide, hoping that President
Aquino and Congress will listen to the people?

The next move is People Power – but do we really want to go through all that again?

source:  Manila Standard Column of Emil Jurado

Personal Note:

ARTICLE 6 - THE LEGISLATIVE DEPARTMENT

Section 1. The legislative power shall be vested in the Congress of the Philippines which shall consist of a Senate and a House of Representatives, except to the extent reserved to the people by the provision on initiative and referendum.

Section 32. The Congress shall, as early as possible, provide for a system of initiative and referendum, and the exceptions therefrom, whereby the people can directly propose and enact laws or approve or reject any act or law or part thereof passed by the Congress or local legislative body after the registration of a petition therefor signed by at least ten per centum of the total number of registered voters, of which every legislative district must be represented by at least three per centum of the registered voters thereof.

.

Malampaya and Art 12 of PH Constitution

Malampaya and Gerry Ortega

The $4.5-billion Malampaya Project is a partnership between the government and Shell to extract natural gas from the waters in the area of Palawan. Based on Presidential Decree 910, the proceeds generated by the government from the Malampaya Project are to be used for energy-related projects but they could also be used for other purposes approved by the President. Reports say that the proceeds now total P170 billion, with an estimated P25 billion spent during the Arroyo administration, while P15 billion has been used under President Benigno Aquino III.

Long before allegations came out that around P900 million of the Malampaya funds found their way into some of Janet Napoles’ fake non-government organizations (NGOs), Dr. Gerardo “Gerry” Ortega had been incessantly blowing the whistle, so to speak, on the alleged corruption involving Palawan’s share of the Malampaya funds (In 2007, Executive Order No. 683 was issued providing for a provisional sharing  between  the national government and the local government of Palawan whereby the 40 percent share of Palawan in the Malampaya proceeds would be used for development projects in the province. From 2005 to 2010, around 2.9 billion was released to the province) Doc Ortega’s acerbic commentaries did not spare prominent personalities, including former Palawan Gov. Joel Reyes who was eventually accused as the mastermind of the assassination of Ortega. As early as 2011, the Commission on Audit recommended the filing of graft and criminal charges against the former governor and members of the provincial bids and awards committee under his administration for alleged irregularities in the use of nearly P3 billion in Malampaya revenues.

Palawan correspondent Redempto Anda revealed that before Dr. Ortega’s death, he and the slain radio commentator had been working on reports on the corruption involved in the Malampaya funds. He must have stepped on somebody else’s powerful toes; before his death, he had been regularly receiving death threats. His widow Patria Ortega said that on almost daily basis in his radio broadcasts he would ask three officials, then Gov. Reyes, Abraham Mitra and Vice-Gov. Dave Ponce de Leon for an accounting of the province’s share in the Malampaya funds.

Dr. Ortega was given no chance to reveal what he knew about the Malampaya corruption because his life was cut short by an assassin’s bullet. Two years after he was shot dead in the morning of January 24, 2011 while inside an ukay-ukay in San Pedro, Puerto Princesa City, Palawan, justice has not yet been done and the alleged masterminds are still at large.

Recently, the Court of Appeals came out with a resolution denying Secretary Leila De Lima’s Motion for Reconsideration to an earlier decision which declared null and void Department Order No. 710 including the resolution of the second panel of prosecutors and reinstated the earlier resolution of the first panel of prosecutors which dismissed the complaint against Mario Joel Reyes.

In ruling for petitioner Mario Reyes, the Court of Appeals said that in creating a new panel of investigators, the Secretary did not comply with Department Circular No. 70 92000 (NPS Rule on Appeals) which outlines the procedure in handling appeals by the Secretary of Justice from a resolution by the investigating prosecutor.

Does the Court of Appeals’ resolution amount to an acquittal of the Reyes brothers and their co-accused? In my humble opinion, it does not. By its resolution, the CA merely declared null and void the creation of the second panel of investigators and reinstated the resolution of the first panel. There is simply no mention here of an acquittal. In fact, the CA resolution can be appealed to the Supreme Court which can either affirm or overturn the same, unlike in the case of an acquittal which, except under extraordinary circumstances, can no longer be subject of an appeal because of the principle on double jeopardy. Assuming the CA resolution in fact amounted to a dismissal of the case against the Reyes brothers, the Supreme Court said on many occasions that the dismissal of a case during preliminary investigation does not constitute double jeopardy which is proscribed by the Constitution. Preliminary investigation is not part of the trial for which double jeopardy attaches. It is merely inquisitorial; a means of discovering the persons who may be reasonably charged with a crime. Moreover, the accused in this case have yet to plead to the crime charged. In other words, the case against the Reyeses and the other co-accused, contrary to reports, was not killed on its tracks because of the CA resolution.

Will the Supreme Court affirm or overturn the CA decision in the event the Secretary appeals the adverse ruling? In deference to the Supreme Court being the final arbiter on the matter, I am in no position to make a second guess. After all, any such attempt is but futile speculation.  Nonetheless, the final resolution by the SC of the Secretary’s appeal, if ever it comes to that, will determine whether or not this case will see the light of day. We can only hope that any forthcoming resolution/s will be based solely on the merits and not on technicalities. In the meantime, despite the setback brought about by these recent judicial developments, the fight for justice must continue and hope that someday the culprits will be apprehended and finally brought to account for their crime if only to give Dr. Ortega’s family the justice which is theirs as a matter of right.

Facebook:  Dean Tony La Vina Twitter:  tonylavs

source:  Manila Standard

Personal Note:   
ARTICLE XII - NATIONAL ECONOMY AND PATRIMONY, Sec 2 paragraphs 4 and 5:

The President may enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other mineral oils according to the general terms and conditions provided by law, based on real contributions to the economic growth and general welfare of the country. In such agreements, the State shall promote the development and use of local scientific and technical resources.

The President shall notify the Congress of every contract entered into in accordance with this provision, within thirty days from its execution.

DAP: Transfering of funds

Transfer of funds

Nobody is denying that President Aquino can transfer funds from his share in the budget. But some are asking: What did he transfer and where did he transfer them to? A ray of hope is that even the Palace has begun to admit that there are problems with the Disbursement Acceleration Program (DAP) which are now being attended to.

The constitutional rule on the transfer of funds is fairly simple: “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.”  Let us dissect this.

First, the President and six other top officials are authorized to transfer funds from their appropriations. This is an exclusive list. Hence, the chief of staff of the Armed Forces, for instance,  may not be given such authority. Likewise, individual members of Congress may not be given such authority and must seek approval from the Speaker or the Senate president if these latter have been authorized by law.

Second, this constitutional power to transfer is activated when Congress passes a law to implement it. For that reason, an authorization from Congress is invariably written in the annual General Appropriations Act.
Third, the named officials can transfer only “savings” in “items” allotted to them. An “item” is a specific amount of money set aside for a special purpose. Savings are leftovers after the purpose has been satisfied.
Fourth, they can transfer savings only to “augment” items in their appropriations. These items which are to be augmented must already be found in the appropriation for their respective departments in the same budget year. What this means is that the power to transfer is not authority to create new items not found in the appropriations act.

An almost identical provision was contained in Article VIII, Section 16(5) of the 1973 Constitution. Under the 1973 Constitution there was an attempt by the president to transfer funds anywhere he wanted. The attempt was based on a Marcos decree, Presidential Decree No. 1177, the Budget Reform Decree of 1977. Section 44 of which said:

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. 

Clearly, Section 44 attempted to empower the president “to indiscriminately transfer funds. . . 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.” Hence, the law was declared unconstitutional in 1987.

Inappropriate provisions. There is another principle related to the budgetary process. And this was the subject of another controversy in 1989 and 1990. The General Appropriations Acts for those years contained similar limitations on the power of the president. The 1989 law said:

Section 55. Prohibition Against the Restoration or Increase of Recommended Appropriations Disapproved and/or Reduced by Congress: No item of appropriation recommended by the President . . . which has been disapproved or reduced in this Act shall be restored or increased by the use of appropriations authorized for other purposes by augmentation. An item of appropriation for any purpose recommended by the President in the Budget shall be deemed to have been disapproved by Congress if no corresponding appropriation for the specific purpose is provided in this act.

There was a similar law in 1990.

Exercising the power of “item veto” the president singled this out for disapproval. Could he do it? This question is important because when the President vetoes a law he should normally veto the entire law with the exception that he may veto “items” in an appropriation law. Were the 1989 and 1990 provisions “items”? They were not. Could the president veto them? Yes, because they were what are now called “inappropriate provisions.”

The Court ruled in 1994: “As the Constitution is explicit that the provision which Congress can include in an appropriations bill must ‘relate specifically to some particular appropriation therein’ and ‘be limited in its operation to the appropriation to which it relates,’ it follows that any provision which does not relate to any particular item, or which extends in its operation beyond an item of appropriation, is considered ‘an inappropriate provision’ which can be vetoed separately from an item.”  Since the 1989 and 1990 laws did not relate to any appropriation item, it was called an “inappropriate provision.” They were “riders” that could be shot down.  The president won.

The outcome of the controversy on the DAP will depend on the answer to factual questions:  Did he transfer “savings” and where did he put them?

source:  Philippine Daily Inquirer Column of Fr. Joaquin Bernas SJ