Canaya, Maricar CorinaLLB I

Position paper on the

Disbursement Acceleration Program

Did the Executive Department usurped the powers of both the Congress through the Disbrsement Acceleration Program?

In the perspective of the petitioners in the consolidated case of Araullo vs. Aquino III1, the DAP surely did seized the power of the Congress. After all, it has too much flaws to begin with. According to the plaintiffs, the DAP gave the Executive branch, particularly the President too much power over public funds. They raised the question of constitutionality of the acts and practices under the DAP, particularly their non-conformity with Section 25(5), Article VI of the Constitution2.

Why did DAP become so controversial? It started in a privilege speech given by Senator Jinggoy Estrada when he 1 G.R. Nos. 209287, 209135, 209136, 209155, 209164, 209260, 209442, 209517 & 2095692(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.

declared that senators who voted to convict former Chief Justice Renato Corona received an additional P50 million each as discretionary funds. Defending the side of the Governemnt, Department of Budget and Management Secretary Florencio Abad justified that the funds had been released to the Senators “based on letters of request for funding”.

The birth of DAP started after President Aquino’s administration decelerated government project implementation. The World Bank however said that the country’s economic progress “could be reduced, xxx and weaken should the Government continue with its underspending and fail to address the large deficiencies in infrastructure”.3 This paved the way for the execution of the DAP as a stimulus package to fast-track the spending and to boost economic development by investing in projects, activities and programs from the savings during the fiscal year.

The Court defined savings as funds that remain unspent after the completion or discontinuance of a project. Congress provided that appropriated funds are available for a period of one fiscal year. But in a May 20, 2013 memo, Budget Secretary Butch Abad sought omnibus authority to consolidate savings and unused funds to finance the DAP on 3 World Bank, http://www.investphilippines.info/arangkada/wp-content/uploads/2011/WB-Philippines-Quarterly-Update-Sept2011.pdf, Cited from Araullo vs Aquino III, G.R. No. 209287, March 3, 2015

a quarterly basis. This shortened the period that funds were supposed to be available for, giving rise to questions about the budget department’s own definition of savings4.

In the July 1, 2014 ruling of the Supreme Court, the justices agreed that the DAP is unconstitutional for violating the principle of separation of powers, as well as the transfers and augmentation based on the following grounds:

Funds that have not yet been released to agencies and funds for programs that have not yet been completed or abandoned cannot be declared as savings

The President cannot put DAP funds in projects that are not in the National Budget;

The President cannot transfer DAP funds from one government branch to another, which the constitution prohibits; and,

The President cannot use standby funds without exceeding to revenue targets

The Malacanang defended that the funds need not be released to agencies to be considered savings. The funds for projects that do not have contracts yet can also be declared savings, because they are free from any obligation.

4 http://www.rappler.com/newsbreak/63267-understanding-supreme-court-ruling-dap

I definitely agree with the Supreme Court ruling. The 1987 Constitution limits the President’s discretion over appropriations when the budget law is being implemented. While DAP’s intention was to boom economic growth, this noble end cannot justify the means done by abusing President Aquino’s presidential powers, hence, it shall not be allowed.

The Constitution only permits the President, the Senate President, the Speaker, the Chief Justice, and heads of Constitutional Commissions to transfer funds “within their respective offices”. These funds involve savings generated from appropriations also for their respective offices.

Moreover, the performance of cross-border transfers, which refers to the movement of funds from one branch of government to another is prohibited by law. The transfer of funds are allowed only within respective offices – thus the use of DAP funds to augment funds of the Commission on Audit (for its IT infrastructure program and the hiring of litigation experts in the amount of P143.7 million, or about $3.2 million) and the House of Representatives (for a legislative library and archives building/e-library in the amount of P250 million, or about $5.6 million) violate the Constitution5.

5 http://www.rappler.com/newsbreak/63267-understanding-supreme-court-ruling-dap

In a concurring and dissenting opinion by Associate Justice Del Castillo, “the exercise of the vast power to realign and to augment should be x x x circumscribed by existing constitutional and legislative standards and limitations as well as safeguards that Congress may institute in the future, consistent with the Constitution, in order to prevent the abuse or misuse of this power”. I definitely agree. By collecting savings and deciding how to use the savings, the Executive department effectively usurped a power that belongs exclusively to Congress.

Just like in the ruling of Planas vs Gil6, “the classical separation of governmental powers, whether viewed in the light of the political philosophy, x x x is a relative theory of government There is more truism and actuality in interdependence than in independence and separation of powers, for as observed by Justice Holmes in a case of Philippine origin, we cannot lay down "with mathematical precision and divide the branches into watertight compartments" not only because "the great ordinances of the Constitution not establish and divide fields of black and white" but also because "even the more specific of them are found to terminate in a penumbra shading gradually from one extreme to the other."

6 G.R. No. 46440. January 18, 1939

Why is there a need for us to respect the principle of separation of powers? Professor David answered it in a simple way: That, in this way do we ensure that every exercise of state power by a branch of Government is capable of being checked by another. If a branch of Government usurped a power that belongs to the other, who then protects our laws?