It's best to have law on savings - Palace

by Aurea Calica, The Philippine Star

Posted at Aug 03 2014 12:40 PM | Updated as of Aug 03 2014 08:40 PM

MANILA - Having a specific law on savings is still the best way to ensure such funds are readily made available for projects without violating the Constitution, deputy presidential spokesperson Abigail Valte said yesterday.

In an interview over radio dzRB, Valte said “it would be good to have legislative backup when it comes to a certain definition,” since “jurisprudence changes.” She was referring to the Supreme Court’s exhortation against the use of savings in the budget for projects or items not specified in the General Appropriations Act.

The SC’s position is contained in its July 1 ruling against the Disbursement Acceleration Program (DAP). The SC is still deliberating on a motion for reconsideration filed by Malacañang.

“It goes without saying that it (definition of savings) has to be consistent with our Constitution but in the Constitution there is no definition of savings. So it’s a good move actually (to have a law on savings) and it’s in keeping with the powers of Congress that is vested on them by the Constitution,” Valte said. “So legislate either clarifications or definitions into our existing law.”

Earlier, Senate Majority Leader Alan Peter Cayetano said Malacañang should clarify with the SC what the latter meant by savings to prevent Congress from mistakenly contravening its ruling.

Cayetano urged the executive department to file an urgent motion for the SC to clarify the “parameters” of savings in its ruling voiding some parts of the DAP.

“If I were President and I control both chambers, I would include in the MR (motion for reconsideration) that the Supreme Court clarify the definition of savings. Let the Supreme Court do it,” he told reporters in a briefing.

But Valte said Cayetano’s point was only for the SC to clarify the definition of savings and that legislation on the matter is still the best option.

“Because as we’ve seen before, when it comes to decided cases of the Supreme Court, it depends (because) the justices also change their minds... because of there is always a change in composition of the Supreme Court,” she said. “And to lawyers like me, we can see that in the history of the cases that have been decided by the Supreme Court.”

Changing ruling

Valte said the best example would be the case of the Priority Development Assistance Fund, which the SC had ruled as constitutional in the past.

“But last year, it was reversed,” Valte said. “I understand that there are several concerns raised about that but it is the power of Congress to define laws; that is really their function. And to avoid such kind of an issue moving forward, legislation is one of the best steps to address any gaps or any gray areas in our law,” Valte said.

“There are a lot of us still waiting also for the resolution of the motion for reconsideration. So perhaps when it comes then more or less there will be settling of the issue,” she said.

She said that while the motion for reconsideration is being deliberated upon, “the best that government can do is to continue to explain when called for it and to continue to put out information that would support our claims on the DAP.”

President Aquino wants the two chambers of Congress to work on either a law or a joint resolution that would allow him to impound funds from slow-moving projects, classify these as savings and use them for purposes at his discretion.

The President wants to impound “savings” as early as the end of the first semester, or midyear – a practice implemented under his DAP

And if an administration ally, Eastern Samar Rep. Ben Evardone of the Liberal Party, would have his way, funds should be classified as savings as often as every three months, as he filed Bill 4770 for this purpose.

The proposal echoes that of Budget Secretary Florencio Abad, who reportedly wants savings declared on a quarterly basis.

It prompted a party-list congressman to remark that the President wanted to legalize DAP and clip Congress’ power of the purse.

The 13 SC justices, in their unanimous 92-page ruling that struck down the DAP, made it clear that since Congress appropriated funds for specific projects of government agencies for utilization within an entire year, no savings should be declared until that period was over.

“The executive could not circumvent this provision by declaring unreleased appropriations and unobligated allotments as savings prior to the end of the fiscal year,” Justice Lucas Bersamin, who wrote the SC ruling, warned in the ruling.

Bersamin was referring to Section 28, Chapter 4, Book 6 of the Administrative Code. A portion of the provision, titled “Reversion of Unexpended Balances of Appropriations, Continuing Appropriations,” clearly prohibits the use of unused funds in advance.

But Aquino, in his 2015 budget message to Congress, stands by the voided DAP.

“We saw it fit to clarify the definition and use of savings and augmentation in light of our policy to push agencies to spend their budgets, or else to lose it,” he declared in his budget message.

“Given that this proposed budget will be valid for one year, it will be counter-intuitive to allow the declaration of savings and augmentation of deficient budget items only at the end of the year,” Aquino said.

No redefinition please

For Quezon City Rep. Winston Castelo, the House of Representatives and the Senate do not have to redefine savings and risk another reversal in the Supreme Court.

He disagreed with his colleagues in the ruling Liberal Party that Congress could allow the President, the chief justice, Senate president, speaker of the House of Representatives, and heads of constitutional commissions to declare and use savings for their respective offices before the end of every fiscal year.

Speaker Feliciano Belmonte Jr. holds the view that Congress can define savings, saying there is no such definition in the Constitution.

“Congress does not have to redefine savings. Savings are unspent appropriations at the end of the year,” Castelo said.

“The President can’t declare savings in the middle of the year. Savings at the end of any fiscal year can only be spent through an appropriation measure duly approved by Congress,” he said.

He said the Supreme Court, in striking certain practices under the DAP as unconstitutional, ruled that savings could only be determined at the end of the budget year.

Castelo recalled that President Aquino sought authorization from Congress last year to use unspent appropriations for the rehabilitation of communities flattened by killer typhoon Yolanda.

“We can’t make shortcuts. The proposed joint Senate-House resolution or inclusion of a provision redefining savings in the 2015 proposed national budget violates the spirit of SC decision,” he said.

“Why redefine savings and court another adverse decision from the Supreme Court?” he asked.

Like Castelo, pork barrel watchdog People’s Initiative Against the Pork Barrel, asked lawmakers not to redefine savings or itemize lump sums in the national budget anymore.

In a statement, the group said allowing the president, chief justice, Senate president, House speaker and heads of constitutional commissions to declare and use savings at mid-year “defeats the constitutional power of Congress to appropriate (public funds).”

“It will be a mechanism to create a huge pork barrel,” it said.

In seeking to allow the use of saved funds on a quarterly basis, Evardone said using such money at the end of the year is impractical.

He said savings have to be used in a timely manner so they could contribute to economic growth, like when DAP funds were poured into infrastructure projects between 2011 and 2013.

He said no less than the World Bank and the Supreme Court had acknowledged that DAP had contributed significantly to economic expansion. With Jess Diaz