Facts:
House
Bill No. 10900, the General Appropriation Bill of 1994 (GAB of 1994), was passed
and approved by both houses of Congress on December 17, 1993. As passed, it imposed
conditions and limitations on certain items of appropriations in the proposed budget
previously submitted by the President. It also authorized members of Congress to
propose and identify projects in the “pork barrels” allotted to them and to realign
their respective operating budgets.
Pursuant to the
procedure on the passage and enactment of bills as prescribed by the Constitution,
Congress presented the said bill to the President for consideration and approval.
On December 30,
1993, the President signed the bill into law, and declared the same to have become
Republic Act NO. 7663, entitled “AN ACT APPROPRIATING FUNDS FOR THE OPERATION OF
THE GOVERNMENT OF THE PHILIPPINES FROM JANUARY ONE TO DECEMBER THIRTY ONE, NINETEEN
HUNDRED AND NINETY-FOUR, AND FOR OTHER PURPOSES” (GAA of 1994). On the same day,
the President delivered his Presidential Veto Message, specifying the provisions
of the bill he vetoed and on which he imposed certain conditions, as follows:
1.
Provision
on Debt Ceiling, on the ground that “this debt reduction scheme cannot be validly
done through the 1994 GAA.” And that “appropriations for payment of public debt,
whether foreign or domestic, are automatically appropriated pursuant to the Foreign
Borrowing Act and Section 31 of P.D. No. 1177 as reiterated under Section 26, Chapter
4, Book VI of E.O. No. 292, the Administrative Code of 1987.
2.
Special
provisions which authorize the use of income and the creation, operation and maintenance
of revolving funds in the appropriation for State Universities and Colleges (SUC’s),
3.
Provision
on 70% (administrative)/30% (contract) ratio for road maintenance.
4.
Special
provision on the purchase by the AFP of medicines in compliance with the Generics
Drugs Law (R.A. No. 6675).
5.
The President
vetoed the underlined proviso in the appropriation for the modernization of the
AFP of the Special Provision No. 2 on the “Use of Fund,” which requires the prior
approval of the Congress for the release of the corresponding modernization funds,
as well as the entire Special Provision No. 3 on the “Specific Prohibition” which
states that the said Modernization Fund “shall not be used for payment of six (6)
additional S-211 Trainer planes, 18 SF-260 Trainer planes and 150 armored personnel
carriers”
6.
New provision
authorizing the Chief of Staff to use savings in the AFP to augment pension and
gratuity funds.
7.
Conditions
on the appropriation for the Supreme Court, Ombudsman, COA, and CHR, the Congress.
Issue:
whether
or not the conditions imposed by the President in the items of the GAA of 1994:
(a) for the Supreme Court, (b) Commission on Audit (COA), (c) Ombudsman, (d) Commission
on Human Rights, (CHR), (e) Citizen Armed Forces Geographical Units (CAFGU’S) and
(f) State Universities and Colleges (SUC’s) are constitutional; whether or not the
veto of the special provision in the appropriation for debt service and the automatic
appropriation of funds therefore is constitutional
Held:
The
veto power, while exercisable by the
President, is actually a part of the legislative process. There is, therefore, sound
basis to indulge in the presumption of validity of a veto. The burden shifts on
those questioning the validity thereof to show that its use is a violation of the
Constitution.
The vetoed provision
on the debt servicing is clearly an attempt to repeal Section 31 of P.D. No. 1177
(Foreign Borrowing Act) and E.O. No. 292, and to reverse the debt payment policy.
As held by the court in Gonzales, the repeal of these laws should be done in a separate
law, not in the appropriations law.
In the veto of
the provision relating to SUCs, there was no undue discrimination when the President
vetoed said special provisions while allowing similar provisions in other government
agencies. If some government agencies were allowed to use their income and maintain
a revolving fund for that purpose, it is because these agencies have been enjoying
such privilege before by virtue of the special laws authorizing such practices as
exceptions to the “one-fund policy” (e.g., R.A. No. 4618 for the National Stud Farm,
P.D. No. 902-A for the Securities and Exchange Commission; E.O. No. 359 for the
Department of Budget and Management’s Procurement Service).
The veto of the
second paragraph of Special Provision No. 2 of the item for the DPWH is unconstitutional.
The Special Provision in question is not an inappropriate provision which can be
the subject of a veto. It is not alien to the appropriation for road maintenance,
and on the other hand, it specifies how the said item shall be expended — 70% by
administrative and 30% by contract.
The Special Provision
which requires that all purchases of medicines by the AFP should strictly comply
with the formulary embodied in the National Drug Policy of the Department of Health
is an “appropriate” provision. Being directly related to and inseparable from the
appropriation item on purchases of medicines by the AFP, the special provision cannot
be vetoed by the President without also vetoing the said item.
The requirement
in Special Provision No. 2 on the “use of Fund” for the AFP modernization program
that the President must submit all purchases of military equipment to Congress for
its approval, is an exercise of the “congressional or legislative veto.” However
the case at bench is not the proper occasion to resolve the issues of the validity
of the legislative veto as provided in Special Provisions Nos. 2 and 3 because the
issues at hand can be disposed of on other grounds. Therefore, being “inappropriate”
provisions, Special Provisions Nos. 2 and 3 were properly vetoed.
Furthermore, Special
Provision No. 3, prohibiting the use of the Modernization fund for payment of the
trainer planes and armored personnel carriers, which have been contracted for by
the AFP, is violative of the Constitutional prohibition on the passage of laws that
impair the obligation of contracts (Art. III, Sec. 10), more so, contracts entered
into by the Government itself. The veto of said special provision is therefore valid.
The Special Provision,
which allows the Chief of Staff to use savings to augment the pension fund for the
AFP being managed by the AFP Retirement and Separation Benefits System is violative
of Sections 25(5) and 29(1) of the Article VI of the Constitution.
Regarding the deactivation
of CAFGUS, we do not find anything in the language used in the challenged Special
Provision that would imply that Congress intended to deny to the President the right
to defer or reduce the spending, much less to deactivate 11,000 CAFGU members all
at once in 1994. But even if such is the intention, the appropriation law is not
the proper vehicle for such purpose. Such intention must be embodied and manifested
in another law considering that it abrades the powers of the Commander-in-Chief
and there are existing laws on the creation of the CAFGU’s to be amended.
On the conditions
imposed by the President on certain provisions relating to appropriations to the
Supreme Court, constitutional commissions, the NHA and the DPWH, there is less basis
to complain when the President said that the expenditures shall be subject to guidelines
he will issue. Until the guidelines are issued, it cannot be determined whether
they are proper or inappropriate. Under the Faithful Execution Clause, the President
has the power to take “necessary and proper steps” to carry into execution the law.
These steps are the ones to be embodied in the guidelines.
