In the Philippines, the “pork barrel” (a term of American-English origin) has been commonly referred to as lump-sum, discretionary funds of Members of the Legislature (“Congressional Pork Barrel”). However, it has also come to refer to certain funds to the Executive. The “Congressional Pork Barrel” can be traced from Act 3044 (Public Works Act of 1922), the Support for Local Development Projects during the Marcos period, the Mindanao Development Fund and Visayas Development Fund and later the Countrywide Development Fund (CDF) under the Corazon Aquino presidency, and the Priority Development Assistance Fund (PDAF) under the Joseph Estrada administration, as continued by the Gloria-Macapagal Arroyo and the present Benigno Aquino III administrations.
SPECIAL PROVISIONS OF THE 2013 PDAF ARTICLE
2. Project Identification. Identification of projects and/or designation of beneficiaries shall conform to the priority list, standard or design prepared by each implementing agency: PROVIDED, That preference shall be given to projects located in the 4th to 6th class municipalities or indigents identified under the MHTS-PR by the DSWD. For this purpose, the implementing agency shall submit to Congress said priority list, standard or design within ninety (90) days from effectivity of this Act.
All programs/projects, except for assistance to indigent patients and scholarships, identified by a member of the House of Representatives outside of his/her legislative district shall have the written concurrence of the member of the House of Representatives of the recipient or beneficiary legislative district, endorsed by the Speaker of the House of Representatives.
3. Legislator’s Allocation. The Total amount of projects to be identified by legislators shall be as follows:
a. For Congressional District or Party-List Representative: Thirty Million Pesos (P30,000,000) for soft programs and projects listed under Item A and Forty Million Pesos (P40,000,000) for infrastructure projects listed under Item B, the purposes of which are in the project menu of Special Provision No. 1; and
b. For Senators: One Hundred Million Pesos (P100,000,000) for soft programs and projects listed under Item A and One Hundred Million Pesos (P100,000,000) for infrastructure projects listed under Item B, the purposes of which are in the project menu of Special Provision No. 1.
Subject to the approved fiscal program for the year and applicable Special Provisions on the use and release of fund, only fifty percent (50%) of the foregoing amounts may be released in the first semester and the remaining fifty percent (50%) may be released in the second semester.
4. Realignment of Funds. Realignment under this Fund may only be allowed once. The Secretaries of Agriculture, Education, Energy, Interior and Local Government, Labor and Employment, Public Works and Highways, Social Welfare and Development and Trade and Industry are also authorized to approve realignment from one project/scope to another within the allotment received from this Fund, subject to the following: (i) for infrastructure projects, realignment is within the same implementing unit and same project category as the original project; (ii) allotment released has not yet been obligated for the original project/scope of work; and (iii) request is with the concurrence of the legislator concerned. The DBM must be informed in writing of any realignment within five (5) calendar days from approval thereof: PROVIDED, That any realignment under this Fund shall be limited within the same classification of soft or hard programs/projects listed under Special Provision 1 hereof: PROVIDED, FURTHER, That in case of realignments, modifications and revisions of projects to be implemented by LGUs, the LGU concerned shall certify that the cash has not yet been disbursed and the funds have been deposited back to the BTr.
Any realignment, modification and revision of the project identification shall be submitted to the House Committee on Appropriations and the Senate Committee on Finance, for favorable endorsement to the DBM or the implementing agency, as the case may be.
5. Release of Funds. All request for release of funds shall be supported by the documents prescribed under Special Provision No. 1 and favorably endorsed by the House Committee on Appropriations and the Senate Committee on Finance, as the case may be. Funds shall be released to the implementing agencies subject to the conditions under Special Provision No. 1 and the limits prescribed under Special Provision No. 3.
PRESIDENTIAL PORK BARREL
The “Presidential Pork Barrel” questioned by the petitioners include the Malampaya Fund and the Presidential Social Fund. The Malampaya Fund was created as a special fund under Section 8, Presidential Decree (PD) 910 by then-President Ferdinand Marcos to help intensify, strengthen, and consolidate government efforts relating to the exploration, exploitation, and development of indigenous energy resources vital to economic growth. The Presidential Social Fund was created under Section 12, Title IV, PD 1869 (1983) or the Charter of the Philippine Amusement and Gaming Corporation (PAGCOR), as amended by PD 1993 issued in 1985. The Presidential Social Fund has been described as a special funding facility managed and administered by the Presidential Management Staff through which the President provides direct assistance to priority programs and projects not funded under the regular budget. It is sourced from the share of the government in the aggregate gross earnings of PAGCOR.
A. Procedural Issues
1.) Whether or not (WON) the issues raised in the consolidated petitions involve an actual and justiciable controversy
2.) WON the issues raised in the consolidated petitions are matters of policy subject to judicial review
3.) WON petitioners have legal standing to sue
4.) WON the 1994 Decision of the Supreme Court (the Court) on Philippine Constitution Association v. Enriquez (Philconsa) and the 2012 Decision of the Court on Lawyers Against Monopoly and Poverty v. Secretary of Budget and Management (LAMP) bar the re-litigation of the issue of constitutionality of the “pork barrel system” under the principles of res judicata and stare decisis
B. Substantive Issues on the “Congressional Pork Barrel”
WON the 2013 PDAF Article and all other Congressional Pork Barrel Laws similar to it are unconstitutional considering that they violate the principles of/constitutional provisions on…
1.) …separation of powers
2.) …non-delegability of legislative power
3.) …checks and balances
5.) …political dynasties
6.) …local autonomy
C. Substantive Issues on the “Presidential Pork Barrel”
WON the phrases:
(a) “and for such other purposes as may be hereafter directed by the President” under Section 8 of PD 910 relating to the Malampaya Funds, and
(b) “to finance the priority infrastructure development projects and to finance the restoration of damaged or destroyed facilities due to calamities, as may be directed and authorized by the Office of the President of the Philippines” under Section 12 of PD 1869, as amended by PD 1993, relating to the Presidential Social Fund,
are unconstitutional insofar as they constitute undue delegations of legislative power
* HELD AND RATIO:
A. Procedural Issues
No question involving the constitutionality or validity of a law or governmental act may be heard and decided by the Court unless there is compliance with the legal requisites for judicial inquiry, namely: (a) there must be an actual case or controversy calling for the exercise of judicial power; (b) the person challenging the act must have the standing to question the validity of the subject act or issuance; (c) the question of constitutionality must be raised at the earliest opportunity; and (d) the issue of constitutionality must be the very lis mota of the case.
1.) YES. There exists an actual and justiciable controversy in these cases. The requirement of contrariety of legal rights is clearly satisfied by the antagonistic positions of the parties on the constitutionality of the “Pork Barrel System.” Also, the questions in these consolidated cases are ripe for adjudication since the challenged funds and the provisions allowing for their utilization – such as the 2013 GAA for the PDAF, PD 910 for the Malampaya Funds and PD 1869, as amended by PD 1993, for the Presidential Social Fund – are currently existing and operational; hence, there exists an immediate or threatened injury to petitioners as a result of the unconstitutional use of these public funds.
As for the PDAF, the Court dispelled the notion that the issues related thereto had been rendered moot and academic by the reforms undertaken by respondents. A case becomes moot when there is no more actual controversy between the parties or no useful purpose can be served in passing upon the merits. The respondents’ proposed line-item budgeting scheme would not terminate the controversy nor diminish the useful purpose for its resolution since said reform is geared towards the 2014 budget, and not the 2013 PDAF Article which, being a distinct subject matter, remains legally effective and existing. Neither will the President’s declaration that he had already “abolished the PDAF” render the issues on PDAF moot precisely because the Executive branch of government has no constitutional authority to nullify or annul its legal existence.
Even on the assumption of mootness, nevertheless, jurisprudence dictates that “the ‘moot and academic’ principle is not a magical formula that can automatically dissuade the Court in resolving a case.” The Court will decide cases, otherwise moot, if:
i.) There is a grave violation of the Constitution: This is clear from the fundamental posture of petitioners – they essentially allege grave violations of the Constitution with respect to the principles of separation of powers, non-delegability of legislative power, checks and balances, accountability and local autonomy.
ii.) The exceptional character of the situation and the paramount public interest is involved: This is also apparent from the nature of the interests involved – the constitutionality of the very system within which significant amounts of public funds have been and continue to be utilized and expended undoubtedly presents a situation of exceptional character as well as a matter of paramount public interest. The present petitions, in fact, have been lodged at a time when the system’s flaws have never before been magnified. To the Court’s mind, the coalescence of the CoA Report, the accounts of numerous whistle-blowers, and the government’s own recognition that reforms are needed “to address the reported abuses of the PDAF” demonstrates a prima facie pattern of abuse which only underscores the importance of the matter.
It is also by this finding that the Court finds petitioners’ claims as not merely theorized, speculative or hypothetical. Of note is the weight accorded by the Court to the findings made by the CoA which is the constitutionally-mandated audit arm of the government. if only for the purpose of validating the existence of an actual and justiciable controversy in these cases, the Court deems the findings under the CoA Report to be sufficient.
iii.) When the constitutional issue raised requires formulation of controlling principles to guide the bench, the bar, and the public: This is applicable largely due to the practical need for a definitive ruling on the system’s constitutionality. There is a compelling need to formulate controlling principles relative to the issues raised herein in order to guide the bench, the bar, and the public, not just for the expeditious resolution of the anticipated disallowance cases, but more importantly, so that the government may be guided on how public funds should be utilized in accordance with constitutional principles.
iv.) The case is capable of repetition yet evading review. This is called for by the recognition that the preparation and passage of the national budget is, by constitutional imprimatur, an affair of annual occurrence. The myriad of issues underlying the manner in which certain public funds are spent, if not resolved at this most opportune time, are capable of repetition and hence, must not evade judicial review.
2.) YES. The intrinsic constitutionality of the “Pork Barrel System” is not an issue dependent upon the wisdom of the political branches of government but rather a legal one which the Constitution itself has commanded the Court to act upon. Scrutinizing the contours of the system along constitutional lines is a task that the political branches of government are incapable of rendering precisely because it is an exercise of judicial power. More importantly, the present Constitution has not only vested the Judiciary the right to exercise judicial power but essentially makes it a duty to proceed therewith (Section 1, Article VIII of the 1987 Constitution).
3. YES. Petitioners have sufficient locus standi to file the instant cases. Petitioners have come before the Court in their respective capacities as citizen-taxpayers and accordingly, assert that they “dutifully contribute to the coffers of the National Treasury.” As taxpayers, they possess the requisite standing to question the validity of the existing “Pork Barrel System” under which the taxes they pay have been and continue to be utilized. They are bound to suffer from the unconstitutional usage of public funds, if the Court so rules. Invariably, taxpayers have been allowed to sue where there is a claim that public funds are illegally disbursed or that public money is being deflected to any improper purpose, or that public funds are wasted through the enforcement of an invalid or unconstitutional law, as in these cases.
Moreover, as citizens, petitioners have equally fulfilled the standing requirement given that the issues they have raised may be classified as matters “of transcendental importance, of overreaching significance to society, or of paramount public interest.” The CoA Chairperson’s statement during the Oral Arguments that the present controversy involves “not [merely] a systems failure” but a “complete breakdown of controls” amplifies the seriousness of the issues involved. Indeed, of greater import than the damage caused by the illegal expenditure of public funds is the mortal wound inflicted upon the fundamental law by the enforcement of an invalid statute.
4.) NO. On the one hand, res judicata states that a judgment on the merits in a previous case rendered by a court of competent jurisdiction would bind a subsequent case if, between the first and second actions, there exists an identity of parties, of subject matter, and of causes of action. This required identity is not attendant hereto since Philconsa and LAMP involved constitutional challenges against the 1994 CDF Article and 2004 PDAF Article respectively. However, the cases at bar call for a broader constitutional scrutiny of the entire “Pork Barrel System”. Also, the ruling in LAMP is essentially a dismissal based on a procedural technicality – and, thus, hardly a judgment on the merits. Thus, res judicata cannot apply.
On the other hand, the doctrine of stare decisis is a bar to any attempt to re-litigate where the same questions relating to the same event have been put forward by the parties similarly situated as in a previous case litigated and decided by a competent court. Absent any powerful countervailing considerations, like cases ought to be decided alike. Philconsa was a limited response to a separation of powers problem, specifically on the propriety of conferring post-enactment identification authority to Members of Congress. On the contrary, the present cases call for a more holistic examination of (a) the inter-relation between the CDF and PDAF Articles with each other, formative as they are of the entire “Pork Barrel System” as well as (b) the intra-relation of post-enactment measures contained within a particular CDF or PDAF Article, including not only those related to the area of project identification but also to the areas of fund release and realignment. The complexity of the issues and the broader legal analyses herein warranted may be, therefore, considered as a powerful countervailing reason against a wholesale application of the stare decisis principle.
In addition, the Court observes that the Philconsa ruling was actually riddled with inherent constitutional inconsistencies which similarly countervail against a full resort to stare decisis. Since the Court now benefits from hindsight and current findings (such as the CoA Report), it must partially abandon its previous ruling in Philconsa insofar as it validated the post-enactment identification authority of Members of Congress on the guise that the same was merely recommendatory.
Again, since LAMP was dismissed on a procedural technicality and, hence, has not set any controlling doctrine susceptible of current application to the substantive issues in these cases, stare decisis would not apply.
B. Substantive Issues on the “Congressional Pork Barrel”
1.) YES. At its core, legislators have been consistently accorded post-enactment authority to identify the projects they desire to be funded through various Congressional Pork Barrel allocations. Under the 2013 PDAF Article, the statutory authority of legislators to identify projects post-GAA may be construed from Special Provisions 1 to 3 and the second paragraph of Special Provision 4. Legislators have also been accorded post-enactment authority in the areas of fund release (Special Provision 5 under the 2013 PDAF Article) and realignment (Special Provision 4, paragraphs 1 and 2 under the 2013 PDAF Article).
Thus, legislators have been, in one form or another, authorized to participate in “the various operational aspects of budgeting,” including “the evaluation of work and financial plans for individual activities” and the “regulation and release of funds”, in violation of the separation of powers principle. That the said authority is treated as merely recommendatory in nature does not alter its unconstitutional tenor since the prohibition covers any role in the implementation or enforcement of the law. Towards this end, the Court must therefore abandon its ruling in Philconsa. The Court also points out that respondents have failed to substantiate their position that the identification authority of legislators is only of recommendatory import.
In addition to declaring the 2013 PDAF Article as well as all other provisions of law which similarly allow legislators to wield any form of post-enactment authority in the implementation or enforcement of the budget, the Court also declared that informal practices, through which legislators have effectively intruded into the proper phases of budget execution, must be deemed as acts of grave abuse of discretion amounting to lack or excess of jurisdiction and, hence, accorded the same unconstitutional treatment.
2.) YES. The 2013 PDAF Article violates the principle of non-delegability since legislators are effectively allowed to individually exercise the power of appropriation, which, as settled in Philconsa, is lodged in Congress. The power to appropriate must be exercised only through legislation, pursuant to Section 29(1), Article VI of the 1987 Constitution which states: “No money shall be paid out of the Treasury except in pursuance of an appropriation made by law.” The power of appropriation, as held by the Court in Bengzon v. Secretary of Justice and Insular Auditor, involves (a) setting apart by law a certain sum from the public revenue for (b) a specified purpose. Under the 2013 PDAF Article, individual legislators are given a personal lump-sum fund from which they are able to dictate (a) how much from such fund would go to (b) a specific project or beneficiary that they themselves also determine. Since these two acts comprise the exercise of the power of appropriation as described in Bengzon, and given that the 2013 PDAF Article authorizes individual legislators to perform the same, undoubtedly, said legislators have been conferred the power to legislate which the Constitution does not, however, allow.
3.) YES. Under the 2013 PDAF Article, the amount of P24.79 Billion only appears as a collective allocation limit since the said amount would be further divided among individual legislators who would then receive personal lump-sum allocations and could, after the GAA is passed, effectively appropriate PDAF funds based on their own discretion. As these intermediate appropriations are made by legislators only after the GAA is passed and hence, outside of the law, it means that the actual items of PDAF appropriation would not have been written into the General Appropriations Bill and thus effectuated without veto consideration. This kind of lump-sum/post-enactment legislative identification budgeting system fosters the creation of a “budget within a budget” which subverts the prescribed procedure of presentment and consequently impairs the President’s power of item veto. As petitioners aptly point out, the President is forced to decide between (a) accepting the entire P24. 79 Billion PDAF allocation without knowing the specific projects of the legislators, which may or may not be consistent with his national agenda and (b) rejecting the whole PDAF to the detriment of all other legislators with legitimate projects.
Even without its post-enactment legislative identification feature, the 2013 PDAF Article would remain constitutionally flawed since the lump-sum amount of P24.79 Billion would be treated as a mere funding source allotted for multiple purposes of spending (i.e. scholarships, medical missions, assistance to indigents, preservation of historical materials, construction of roads, flood control, etc). This setup connotes that the appropriation law leaves the actual amounts and purposes of the appropriation for further determination and, therefore, does not readily indicate a discernible item which may be subject to the President’s power of item veto.
The same lump-sum budgeting scheme has, as the CoA Chairperson relays, “limit[ed] state auditors from obtaining relevant data and information that would aid in more stringently auditing the utilization of said Funds.” Accordingly, she recommends the adoption of a “line by line budget or amount per proposed program, activity or project, and per implementing agency.”
4.) YES. To a certain extent, the conduct of oversight would be tainted as said legislators, who are vested with post-enactment authority, would, in effect, be checking on activities in which they themselves participate. Also, this very same concept of post-enactment authorization runs afoul of Section 14, Article VI of the 1987 Constitution which provides that: “…[A Senator or Member of the House of Representatives] shall not intervene in any matter before any office of the Government for his pecuniary benefit or where he may be called upon to act on account of his office.” Allowing legislators to intervene in the various phases of project implementation renders them susceptible to taking undue advantage of their own office.
The Court, however, cannot completely agree that the same post-enactment authority and/or the individual legislator‘s control of his PDAF per se would allow him to perpetuate himself in office. Indeed, while the Congressional Pork Barrel and a legislator‘s use thereof may be linked to this area of interest, the use of his PDAF for re-election purposes is a matter which must be analyzed based on particular facts and on a case-to-case basis.
Also, while the Court accounts for the possibility that the close operational proximity between legislators and the Executive department, through the former’s post-enactment participation, may affect the process of impeachment, this matter largely borders on the domain of politics and does not strictly concern the Pork Barrel System’s intrinsic constitutionality. As such, it is an improper subject of judicial assessment.
5.) NO. Section 26, Article II of the 1987 Constitution is considered as not self-executing due to the qualifying phrase “as may be defined by law.” In this respect, said provision does not, by and of itself, provide a judicially enforceable constitutional right but merely specifies a guideline for legislative or executive action. Therefore, since there appears to be no standing law which crystallizes the policy on political dynasties for enforcement, the Court must defer from ruling on this issue.
In any event, the Court finds the above-stated argument on this score to be largely speculative since it has not been properly demonstrated how the Pork Barrel System would be able to propagate political dynasties.
6.) YES. The Court, however, finds an inherent defect in the system which actually belies the avowed intention of “making equal the unequal” (Philconsa, 1994). The gauge of PDAF and CDF allocation/division is based solely on the fact of office, without taking into account the specific interests and peculiarities of the district the legislator represents. As a result, a district representative of a highly-urbanized metropolis gets the same amount of funding as a district representative of a far-flung rural province which would be relatively “underdeveloped” compared to the former. To add, what rouses graver scrutiny is that even Senators and Party-List Representatives – and in some years, even the Vice-President – who do not represent any locality, receive funding from the Congressional Pork Barrel as well.
The Court also observes that this concept of legislator control underlying the CDF and PDAF conflicts with the functions of the various Local Development Councils (LDCs) which are already legally mandated to “assist the corresponding sanggunian in setting the direction of economic and social development, and coordinating development efforts within its territorial jurisdiction.” Considering that LDCs are instrumentalities whose functions are essentially geared towards managing local affairs, their programs, policies and resolutions should not be overridden nor duplicated by individual legislators, who are national officers that have no law-making authority except only when acting as a body.
C. Substantive Issues on the “Presidential Pork Barrel”
YES. Regarding the Malampaya Fund: The phrase “and for such other purposes as may be hereafter directed by the President” under Section 8 of PD 910 constitutes an undue delegation of legislative power insofar as it does not lay down a sufficient standard to adequately determine the limits of the President’s authority with respect to the purpose for which the Malampaya Funds may be used. As it reads, the said phrase gives the President wide latitude to use the Malampaya Funds for any other purpose he may direct and, in effect, allows him to unilaterally appropriate public funds beyond the purview of the law.
That the subject phrase may be confined only to “energy resource development and exploitation programs and projects of the government” under the principle of ejusdem generis, meaning that the general word or phrase is to be construed to include – or be restricted to – things akin to, resembling, or of the same kind or class as those specifically mentioned, is belied by three (3) reasons: first, the phrase “energy resource development and exploitation programs and projects of the government” states a singular and general class and hence, cannot be treated as a statutory reference of specific things from which the general phrase “for such other purposes” may be limited; second, the said phrase also exhausts the class it represents, namely energy development programs of the government; and, third, the Executive department has used the Malampaya Funds for non-energy related purposes under the subject phrase, thereby contradicting respondents’ own position that it is limited only to “energy resource development and exploitation programs and projects of the government.”
However, the rest of Section 8, insofar as it allows for the use of the Malampaya Funds “to finance energy resource development and exploitation programs and projects of the government,” remains legally effective and subsisting.
Regarding the Presidential Social Fund: Section 12 of PD 1869, as amended by PD 1993, indicates that the Presidential Social Fund may be used “to [first,] finance the priority infrastructure development projects and [second,] to finance the restoration of damaged or destroyed facilities due to calamities, as may be directed and authorized by the Office of the President of the Philippines.”
The second indicated purpose adequately curtails the authority of the President to spend the Presidential Social Fund only for restoration purposes which arise from calamities. The first indicated purpose, however, gives him carte blanche authority to use the same fund for any infrastructure project he may so determine as a “priority“. Verily, the law does not supply a definition of “priority infrastructure development projects” and hence, leaves the President without any guideline to construe the same. To note, the delimitation of a project as one of “infrastructure” is too broad of a classification since the said term could pertain to any kind of facility. Thus, the phrase “to finance the priority infrastructure development projects” must be stricken down as unconstitutional since – similar to Section 8 of PD 910 – it lies independently unfettered by any sufficient standard of the delegating law. As they are severable, all other provisions of Section 12 of PD 1869, as amended by PD 1993, remains legally effective and subsisting.