DAP no longer exists, SolGen tells high court

By: Christine O. Avendaño, Jerome Aning - 11 years ago

Solicitor General Francis Jardeleza. INQUIRER FILE PHOTO

MANILA, Philippines—The Aquino administration on Tuesday urged the Supreme Court to dismiss petitions seeking to declare as unconstitutional the Disbursement Acceleration Program (DAP)—a savings impounding mechanism purportedly created to pump prime the economy—saying the presidential pork barrel fund was being terminated.

Solicitor General Francis Jardeleza and Budget Secretary Florencio Abad were questioned at the resumption of oral arguments on the DAP, which came into light after Sen. Jinggoy Estrada disclosed that additional pork barrel funds were released to senators following the conviction of then Chief Justice Renato Corona in 2012.

The questions included whether the President could augment funds for items not for the executive department and the executive department’s definition of savings that can fall under the DAP.

Earlier Tuesday, Jardeleza met with reporters to say that the government would plead to the high court to dismiss the nine anti-DAP petitions because the Palace had stopped its use since mid-2013 because the P149 million it used to pump-prime the economy for the past three years had been achieved.

Jardeleza said the anti-DAP petitions had become moot and academic because the DAP was “extinct.” He also said government lawyers had submitted to the high court seven memoranda signed by President Aquino authorizing 116 uses of the DAP.

Jardeleza said this evidence would allay apprehensions that the President had not authorized the DAP, apparently in reference to Senior Associate Justice Antonio Carpio’s earlier questions on whether the creation of the DAP had the authority of the President.

Abad told the court that the DAP “had already served fully its purpose and that was why the economic managers recommended its termination to the President.” He also said that the use of savings to augment funds of the government had been done in the previous administrations.

Abad said the Aquino administration decided to accelerate government spending because early on they had to “plug leakages” in the budget that had slowed down spending and hampered domestic growth.

“The DAP is not about the use of savings and unprogrammed funds but a package of reform interventions,” Abad said.

Jardeleza also said the 116 DAP projects were funded with the use of savings and unprogrammed funds and were made in the third and fourth quarters of the year. This showed the augmentation was only done after the appropriations balances became available.

He also said Congress had never disagreed with the way the executive branch had complied with its definition of savings found in the General Appropriations Act (GAA) and in the absence of this, the high court “has no occasion to exercise its powers to allocate constitutional boundaries.”

Associate Justice Lucas Bersamin said that it seemed the DAP objective was not to stimulate the economy but to “create big pool of savings” based on the “language” of the Department of Budget and Management (DBM) memorandum to the President on June 25, 2012.

But the solicitor general said the memoranda “do not tell the story of the DAP” but “simply serve to comply with the laws and the Constitution.”

Cross-border augmentation

Bersamin also questioned whether the executive violated the Constitution when it allowed “cross-border augmentation” from one department to another.

Abad admitted there were only two instances when the executive had done this—when the House requested additional funding for the establishment of an e-library and when the Commission on Audit requested funding for a good governance project.

Bersamin also asked Abad to clarify reports that senators benefited from DAP funds during the impeachment trial of Corona and was told that this was not true.

“Those releases were not given to senators,” Abad said, noting the senators merely recommended to use savings to augment certain items deficient in the items of budget of certain departments.

Carpio asked Jardeleza if savings used to augment items out of the budget was unconstitutional and the latter agreed with him.

Juggling appropriations

Chief Justice Ma. Lourdes Sereno and the other justices focused on the supposed defects on National Budget Circular No. 541, issued by Abad in July 2012, which instituted the DAP.

One of the controversial provisions in the circular provided for the use of withdrawn allotments to “augment existing programs and projects of any agency and to fund priority programs and projects not considered in the 2012 budget but expended to be started or implemented during the current year.”

The petitioners claimed the withdrawn allotments may not be declared as savings and using them on items not considered in the budget violated the Constitution.

Section 25 (5) of the Constitution states: “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.”

Sereno noted the “unfortunate language” used in the circular while Justice Marvic Leonen said the court would have to give priority to what the text of the Constitution stated.

Written by ‘neophytes’

Justice Arturo Brion pointedly asked Abad if he was certain that the document was not written by “neophytes,” and went on to question the budgetary expertise as well as knowledge in “statutory construction” of the DBM lawyers that crafted the document.

Sereno said it was also possible that the one who crafted the circular was merely after monitoring of agencies’ targets and performances without referring to “statutorily required observances.”

Abad had to apologize repeatedly for the provision and promised, as requested by Sereno, to provide a “history” of the circular.

Sereno said the court wanted to know the precise constitutional issues and what standards to apply with regards to restrictions provided in the budget. She recalled that in the United States, Congress had insisted that it was the president’s duty to enforce the budget law.

She also asked if it was possible that the circular was only talking about projects for which there were no specific appropriation restrictions under the law, or that it was possible that the circular was the “product of a failure to distinguish between what are statutorily required observances and those which are just needed for monitoring.”

Leonen also asked why the executive branch did not just wait for next year’s session of Congress to seek funding to stimulate the economy. Jardeleza said the President made an “executive decision” to use the funds.

Justice Roberto Abad questioned the bases of the executive department’s decision that a project had been “abandoned” so that funding for it can be diverted. He said if this was done then, in a way, the executive department could have altered the will of Congress.