PRESIDENT Rodrigo Duterte has applied a line veto to four provisions of the General Appropriations Act of 2018, saying they attempt to circumvent the Constitution, and has put conditions on seven provisions to ensure that the new budget will be consistent and faithful to existing laws, policies, rules and regulations.
“Under my Administration, attempts to circumvent the Constitution will never be countenanced. By constitutional fiat, specifically Section 25 (2), Article VI of the 1987 Constitution, provisions embraced in this budget which do not relate to some particular appropriation and are introduced herein with the purpose of amending existing laws and rules have no place in the general appropriations bill. These ‘rider’ provisions must accordingly be subject to direct veto,” the President said in his 11-page veto message to Congress released Wednesday.
The President also scored members of the Constitutional Fiscal Autonomy Group [CFAG]—composed of the Supreme Court, the Commission on Elections, the Civil Service Commission, the Commission on Audit, the Commission on Human Rights and the Office of the Ombudsman—calling on them to “answer the clarion call for a shared fiscal responsibility.”
Duterte made this call in response to the Joint Resolution No. 1 issued by the CFAG in 1999, which provided that all unexpended year-end balances of these agencies shall continue to be available until fully spent.
“There is no better way to inculcate fiscal prudence and sound financial management than to adopt the one-year validity of appropriations in the FY 2018 budget. Alongside this policy is the reversion of all unexpended balance of appropriations to the National Treasury by the end of FY 2018,” he said.
“Towards this end, I hereby direct the Executive Branch and strongly urge the CFAG to apply the reversion of all unexpended balances of appropriations in pursuit of genuine fiscal autonomy,” he added.
He also thanked the Congress for passing the P3.77-trillion national budget.
“I thank the Congress for not failing us. Indeed, the members of Congress are our partners in our journey towards a more prosperous future,” he said in Filipino.
“Powered by a sound financing program and carefully crafted priorities, the 2018 budget will not only foster the golden age of infrastructure and secure peace and order, but also accelerate human capital development for sustained and inclusive growth,” he added.
First, Duterte placed under direct veto the grant of monitoring expenses of the Movie and Television Review and Classification Board, saying that monitoring expenses are already present in the honoraria or per diems of board members.
Second, the President vetoed General Provisions, Section 87, “Collection of Fees in Relation to the Retention or Reacquisition of Philippine Citizenship,” Volume I-B, page 637, which prohibits the imposition and collections of fees.
Third, he also directly vetoed Special Provision No. 14 of the Department of Education-Office of the Secretary, under the provision “Use of School Maintenance and Other Operating Expenses for Payment of Items That May Be Classified as Capital Outlay,” Volume I-A, page 189.
Duterte said that this authorizes the DepEd to use appropriations for maintenance and other operating requirements for its capital outlay requirements.
While he vetoed the use of MOOEs for capital outlay, Duterte had placed the same under conditional implementation “in justifiable circumstances, and upon compliance with the general provision and pertinent rules in the modification of allotment.”
Lastly, the President vetoed Special Provision No. 1 of the Energy Regulatory Commission or the “Use of Income,” Volume I-B, page 225, to augment the operational requirements of the ERC.
“Apart from being a rider, the sources of income enumerated have already been included in the Non-Tax Revenue Program for FY 2018, thereby resulting in double programming for the said income sources. The ERC should instead make efficient use of its budget and automatic appropriations in the amount of P413.60M,” he said.
Under conditional implementation, Duterte has allowed double programming in the creation of a revolving fund for the research and development institutes of the Department of Science and Technology; and the use of income for collections in drug rehabilitation activities by the Dangerous Drugs Board.
Duterte said that the new General Appropriations Act will act as the new “allotment order,” which is needed for the release of appropriations, except those identified by the Budget Department.
To ensure that appropriations will be efficient, the use of the budget will be subject to one-year validity under Section 59 of the General Provisions of GAA.
The budget of government-owned and controlled corporations were subjected to conditional implementation, hence, all subsidies to GOCCs will be used until Dec. 31, and any balance should be reverted back to the Treasury.
Duterte also tasked the Budget Department and the Bureau of Treasury to ensure that only those not appropriated in the budgets of agencies and by the NDRRMF will be funded by the budgets of unprogrammed funds for the National Disaster Risk Reduction and Management Fund, particularly those concerning the use of excess income.
For public-private partnership programs, the President has allowed the use of the PPP Strategic Support Fund, but only to support the Project Development and Monitoring Facility fund, which properly covers all preparatory activities such as right of way acquisitions, engagement of independent consultants, and provision of cash subsidy.
Duterte also reminded the Commission on Higher Education to ensure the implementation of the grant of tuition subsidy to medical students in SUCs.
Until Congress has enacted a new immigration modernization law in 2018, Duterte has allowed the establishment of a trust fund to be constituted from the use of express lane fees and charges collected by the BI for the payment of salaries and overtime to BI employees.
To ensure universal health insurance coverage, Duterte allowed the use of supplemental PhilHealth benefits, upon the full utilization of P3.5 billion appropriated under the Miscellaneous Personnel Benefits Fund.
Since no appropriation was allotted for the payment of insurance premiums under Section 2 of Republic Act No. 7875, supplemental PhilHealth benefits may also be used for the same.
The Philippine foreign service posts abroad may use cash of their working fund, but shall not exceed their appropriations authorized for such and shall be subject to the cash disbursement ceiling imposed by the DBM.
Duterte also encouraged the DFA to efficiently use its Building Fund and Rental Funds for the acquisition, renovation or rentals of chanceries and residences.
Duterte also placed the following under conditional implementation, subject to compliance with existing laws, policies, rules and regulations:
– For the Philippine Coast Guard and the National Coast Watch Center to seek approval of the Fiscal Incentives Review Board to allow its non-cash transactions to be qualified for tax subsidy status;
– For DepEd to seek DBM approval on the creation of new teaching positions;
– For DOJ to seek DBM approval on the grant of hazard pay to personnel of the National Bureau of Investigation;
–For the Philippine National Police to seek DICT approval on its Digitization Program of the Internal Affairs Service;
–For the Bureau of Customs to seek DICT approval on its Bulk and Break Bulk Enahancement Program;
– Compliance of the Building Code for the construction of all new government facilities;
– Limit financial assistance to local government units for the repair of bridges under the conditional matching grant to provinces for road repair; and
– Exclude MOOE as an allowable Engineering and Administrative Overhead expense under the budget of Department of Public Works and Highways.