On why the Supreme Court didn’t overlook the Administrative Code

In Raissa’s latest post, she laments that some lawyers have had one of three reactions to her earlier post where she argues that the 1987 Administrative Code qualifies the President’s Constitutional power to augment: (1) the Constitution is clear; (2) the SC decision is unanimous; or (3) she’s not a lawyer.

Alarmed by the condescension I note in the tone of my brothers, I wrote this, not because I’m a lawyer, and she’s not, but because I came to the same conclusion until I looked at the provisions of law the DBM used as basis for the DAP.

I, too, share the same admiration that Senator Saguisag has for Raissa’s analysis, not because she took a second look at that DBM site page and read it in light of the DAP rulings, but because she took those arguments and attempted to make it into a coherent argument.

That being said, I still maintain that a contrary interpretation violates the separation of powers, and that the term “savings” is cross-defined in the GAA.

Two things may have been overlooked, which sit right on the DBM page explaining the legal bases for the DAP.

First, the power to augment on the part of the President is embodied in the provisions that Raissa cites in the Administrative Code of 1987, and in the other provisions that surround it. However, that the Administrative Code of 1987 was passed days before the 1987 Constitution does not necessarily mean that it is constitutional as well. The Administrative Code is a political law that must be interpreted below the Constitution, that is to say that the interpretation of the Administrative Code that is most in line with the Constitution will govern, if it means that by that interpretation the Administrative Code survives. A statute cannot be used to determine whether another law meets the requirements of the Constitution, because that starts a circular argument.

Raissa does note that a friend of hers has chided her on that view, and while she has taken it in stride, it is not critical to determine the Constitutionality of the provisions on the power to augment in determining the validity of DAP. The Supreme Court will refrain as much as possible from ruling on issues of constitutionality, especially when these are collateral issues.

Second, as Raissa notes, the definition of savings in a law that determines the power to augment may be the subject of a statute. We may be put on notice that this is what Congress has done, in fact. So keen is Congress to implement the long-standing rule of government contracts: an appropriation is required for every contract entered into by government, that the power to augment for other branches of government (only seven other people share the power to augment) is always defined further in the General Appropriations Act.

To support the legality of the DAP, the DBM points to Sections 59 and 60 of RA No. 10147, Sections 53 and 54 of RA No. 10155, and Sections 52 and 53 of RA No. 10352. These laws are the General Appropriations Acts (GAAs) for 2011, 2012, and 2013, respectively, and these sections are identically worded. Might I break it down, to use a term from the street. Savings are defined in the GAAs:

Savings refer to portions or balances of any programmed appropriation in this Act free from any obligation or encumbrance which are: (i) still available after the completion or final discontinuance or abandonment of the work, activity or purpose for which the appropriation is authorized; (ii) from appropriations balances arising from unpaid compensation and related costs pertaining to vacant positions and leaves of absence without pay; and (iii) from appropriations balances realized from the implementation of measures resulting in improved systems and efficiencies and thus enabled agencies to meet and deliver the required or planned targets, programs and services approved in this Act at a lesser cost.

In plainspeak, you book savings only when:

1. A government project is finally stopped, discontinued, or abandoned.
2. There are people who quit.
3. You ran the government good enough to spend less than what the guys on the ground gave as an estimate of just how much is needed.

Obviously, items two and three do not apply, so let’s not go there.

You may then argue that an impounded project is a project that is finally stopped, discontinued, or abandoned, but then that’s a bit wrong.

The words, “stopped”, “discontinued”, and “abandoned” do not have plain and technical meanings. However, these words are qualified by the word, “finally”, and that’s where the rub lies.

The biggest problem with DAP is that it used money sourced from impounded public projects to fund other public projects that may or may not have been approved at the time of the passage of the national budget.

The power to impound traces its roots to Thomas Jefferson in 1801 and is part of the Executive Power (according to the Court in Marcos v. Manglapus, quite large in scope indeed, especially when compared to the US President – the US President has a very limited power to impound, and has no line item veto power). Under that meaning, the President holds the money instead of spending it. It does not mean that the President will spend it elsewhere; that is the power to augment.

By and large the power to impound is restricted only by the discretion of the President. However, the impoundment of an act does not mean that it has been stopped. It only means that the President will not cause funds to flow to the project. By all means, Congress can restore funding to the project the following year. Moreover, the President can realign funds to later cause funding to flow to that particular project should savings arise. The limitation there is that the President cannot realign funds to a project that does not already exist within the framework of the GAA at the time the funds are realigned. In other words, the President cannot stop with finality an act mandated by Congress. He can only hold the implementation of the law in abeyance.

On now, to the power to augment. It means what it means: to add to what already exists. In other words, even if we were to assume that the President could in fact consider impounded budgets as savings, the President cannot just transfer the funds to just any project or program. The project or program must be one contemplated by Congress at the time of the passage of the GAA. This keeps with the principle that every disbursement of public funds must be able to trace itself to an act of Congress.

Hard cases make bad law, so said Oliver Wendell Holmes. These DAP rulings, though they may seem unjust in that they may force a good man to give up his post, has made good law, because it is necessary to keep intact the separation of powers at its most fundamental.

Consider: President Z decides to impound every single line item in the 2017 national budget. He then declares the entire national budget as “savings” and then proceeds to realign them as he sees fit. This is the case had DAP been found constitutional. In this scenario, however, Congress is emasculated. Congress is left to passing a large number at the end of budget deliberations, and for not putting each and every single department through hell, each member of Congress is reduced to a mendicant to make sure their projects are not impounded, in the manner of Richard Nixon. It is to PNoy and Abad’s credit that this has not been the case.

To open the keys to this kingdom will be to open even more unfettered reign over government to just one of the branches. Congress cannot be an effective counterbalance to the enormous weight of the Presidency if it cannot do its function to safeguard the people’s money.

I hope that wasn’t condescending. I’m looking forward to that article on savings.


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