constitutional provisions on budgeting

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Constitution codals about budgeting in the Philippines

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Constitutional Provisions on BudgetingBy John Dx Lapid for Macroeconomics

a. Section 24, Article VI, which states that;

All appropriations, revenue or tariff bills increase of the public debt, bills of local application and private bills shall originate EXCLUSIVELY in the House of Representatives, but the Senate may propose or concur with amendments.

notes: Money bills MUST originate in the HR. The Supreme Court explained this in Tolentino V. Secretary of Finance, 1994, the Court said the exclusivity of the prerogative of the HR means simply that the lower house ALONE can initiate the passage of a revenue bill, such that, if the House does not initiate one, no revenue law will be passed. The Senate can completely overhaul the BILL, by amendment of parts or by amendment by substitution, and come out with one completely different from what the House approved.

Textually, it is the BILL which MUST EXCLUSIVELY originate from the LOWER HOUSE; but the LAW itself which is the product of the total bicameral legislative process originates not just from the House but from both the Senate and the house.Why in the H of R? District Representatives are closer to the pulse of the people than senators are and are therefore in a better position to determine both the extent of the legal burden they are capable of bearing and the benefits that they need. (1987 Constitution of the Philippines a Commentary, Bernas 2003 edition)

Appropriation law - A statute the primary purpose and specific purpose of which is to authorize the release of public funds from the treasury.

Classification:1. General Appropriation law passed annually, intended to provide for the financial operations of the entire government during one fiscal period.

2. Special Appropriation law designed for a specific purpose.

take note that;

a. Appropriation must be devoted to public purpose (Pascual V. Secretary of Public Works and Communications)

b. The sum authorized to be released must be determinate or at least determinable (Guingona V. Carague)

Limitations on special appropriation measures;

i. Must specify the public purpose for which the sum is intended.ii. Must be supported by funds actually available as certified to by the National Treasurer, or to be raised by a corresponding revenue proposal included therein [Sec. 25, (4), Art. VI]

b. Section 25 (1), Article VI, states that;

The Congress may not increase the appropriations recommended by the President for the operation of the government as specified in the budget. The form, content, and manner of preparation of the budget shall be prescribed by law.

Note: this is a limitation provided by the Constitution to the power of the Congress to exclusively enact the Appropriation law.

c. Section 25 (2), Article VI states that;

No provision or enactment shall be embraced in the General Appropriations Bill unless it relates specifically to some particular appropriation therein. Any such provision or enactment shall be limited in its operation to the appropriations to which it relates.

Note: All provisions or enactments in the General Appropriations Bill shall relate SPECIFICALLY to the particular appropriation therein. Such provision shall be LIMITED only in its operation to which it relates.

d. Section 25 (4), Article VI:

A special appropriations bill shall specify the purpose for which it is intended, and shall be supported by funds actually available as certified by the National Treasurer, or to be raised by a corresponding revenue proposal therein.

Note:Requisites for a Special Appropriations Bill1. Specific purpose for which it is intended2. It should be supported by funds actually available3. Such funds should be certified by the National Treasurer

Special Appropriation Bill/Law Designed for a specific purpose.

e. Section 25 (5), Article VI:

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 e offices from savings in other items of their respective appropriations.

Note: General Rule: The Congress cannot pass or enact a law authorizing ANY transfer of appropriations.

Exception: The Congress may enact a law authorizing to augment any item in the general appropriations law for the offices of the President, Senate President, Speaker of the House, Chief Justice, and the Heads of the Constitutional Commissions.

(Take note that the list of who are authorized to transfer funds is exclusive.)

Such fund shall be from the savings in other items of the respective appropriations of the offices.

Hence if there are savings in the appropriations of a certain office such fund can be transferred, however it needs a law to allow it, it is not discretionary on their part. f. Section 25 (7), Article VI;If, by the end of any fiscal year, the Congress shall have failed to pass the general appropriations bill for the ensuing fiscal year, the general appropriations law for the preceding fiscal year shall be deemed re-enacted and shall remain in force and effect until the general appropriations bill is passed by the Congress.Note: the end of fiscal year in the Philippines is the same with the calendar year. The budget is drafted by the President before the year ends.

Notes:

Constitutional rules on general appropriations law:

1. The Lower House cannot increase the appropriations recommended by the President as specified in the budget.

2. The form, content and manner of preparation of the budget shall be prescribed by law.

3. No provision or enactment shall be embraced unless it relates specifically to some particular appropriation therein.

4. Procedure for approving the appropriations for Congress shall strictly follow the procedure for approving appropriations for other departments and agencies.

5. Prohibition against transfer of appropriations.

6. Prohibition against appropriations for sectarian benefit. (religious benefit) [Sec. 29 (2), Article VI]

7. Automatic reappropriation.

Section 25, Article VI paragraphs 1, 2, 3, 4, 5, 7are the limitation on the power to appropriate.

Note:

The historic practice is that the presidential budget may be decreased but not increased.

Provisions unrelated to the appropriation bill are considered prohibited riders

Enactment of a law to transfer funds is prohibited by law.

Except: when the President, Senate president, Speaker of the House, Chief Justice and the heads of the Constitutional Commissions may by legislation (there is a necessity to enact a law to allow them to have the authority), be authorized to augment ANY ITEM IN THE General Appropriations Law for their respective offices PROVIDED THAT IT WILL BE TAKEN IF EVER THERE ARE savings in other items of their respective appropriations.

Take note that the list of who are authorized to transfer funds is exclusive.

We must take note that the appropriations MUST BE for A PUBLIC PURPOSE, of course.

The test of the constitutionality of a statute requiring the use of public funds is whether the statute is designed to promote the public interest, as opposed to the furtherance of the advantage of individuals, although such advantage to individuals might incidentally serve the public. (Bernas, 2003)

g. Section 22, Article VII:

The President shall submit to the Congress within thirty (30) days from the opening of every regular session, as the basis of the General Appropriations Bill, a budget of receipts and expenditures and sources of financing, including receipts from existing and proposed revenue measures.

Note: the president shall submit a BUDGET OF RECEIPTS AND EXPENDITURES AND SOURCES OF FINANCING; this should be the basis of the General Appropriations Bill which shall be exclusively drafted by the lower house.

Sources of financing this phrase implies that financing can come from sources other than revenue measures.

When shall the President submit the Budget? 30 days from the opening of the regular session of the Congress, this begins every year on the 4th Monday of July.

h. Section 27 (2), Article IV;The President shall have the power to VETO ANY particular ITEM or ITEMS in an appropriation, revenue, or tariff bill, but the veto shall not affect the item or items to which he does not object.

Note: the president has the power to VETO ANY PARTICULAR ITEM or ITEMS in an appropriation, revenue or tariff bill however it shall not affect the item or items which the president does not object.

Note: it is only the General Appropriations Bill that the President can exercise the Line Veto (A kind of veto that allows the president to particularly reject a provision)

Doctrine of Inappropriate Provisions

A provision that is constitutionally inappropriate for an appropriation bill may be singled out for veto even if it is not an appropriation or revenue item. In essence what this means is that the President may veto riders in an appropriation bill.

Executive Impoundment

It is the refusal of the President to spend funds already allocated by Congress for a specific purpose. References

Political Law outline reviewer by Justice Antonio Nachura, 2009

The 1987 Constitution of the Republic of the Philippines, a Commentary, Fr. Joaquin Bernas, 2003

The 1987 Constitution of the Republic of the Philippines, a Comprehensive Reviewer, Fr. Joaquin Bernas, 2011