A lot of people tuned in during the oral arguments by the Executive Branch before the Supreme Court last 28 January 2014. The Executive was represented by the Department of Budget and Management (DBM) Secretary Butch Abad and the Solicitor General Francis Jardeleza. It was interesting to know the answers to several questions: Whose idea was DAP? Why was it put together? Who drafted it? What was the impact of enforcing DAP in the bureaucracy? When dod it start? These would have been easy to learn if we had a Freedom on Information Law or even just the Robredo-Disclosure Bill.
There were also public administration principles that were considered and really new ones that were offered such as the “use or lose” principle invoked by the Executive to force the Executive agencies to use their funds. Savings declared as early as June of the fiscal year (this is disastrous, to say the least). Augmenting an item which is not for the Executive Branch (notion of cross border funding, such as Commission on Audit and House of Representatives). Use of mandatory reserves which cannot be used to augment other items. Loose use of such key budgeting principles as “mandatory reserves,” “augmentation fund,“ “final discontinuance,” abandonment” and “re-alignment.”
Interestingly, the whole oral defense of the Executive Branch sets aside the existing process (Budget Call), the role of the Development Budget Coordination Committee (DBCC) as well as that of Congress. There was no specificity because the 2010 budget essentially was a budget of the previous administration and that is why they impounded (review of expenses and projects) some funds resulting in a slowdown which thus affected growth. Because of their decision to slow things down, there was negligible growth and the economy contracted. It was not because of the absorptive capacity of the Bureucracy or the DRRM Law as they pointed out. In fact, the Disaster and Risk Reduction and Management was not given the P1-billion budget needed and one of the early budget reforms the Aquino administration did was to remove pre-disaster share of the national with the local government units.
Interestingly, too, the Aquino Administration adopted in FY 2011 zero-based budgeting. If indeed it was a zero-based budgeting, there would have been no slow grind. It would have cured the defect they wanted done. Zero-based budgeting is an approach to planning and decision-making which reverses the working process of traditional budgeting. In traditional incremental budgeting (Historic Budgeting), departmental managers justify only variances versus past years, based on the assumption that the “baseline” is automatically approved. By contrast, in zero-based budgeting, every line item of the budget must be approved, rather than only changes. During the review process, no reference is made to the previous level of expenditure. Zero-based budgeting requires the budget request be re-evaluated thoroughly, starting from the zero-base. This process is independent of whether the total budget or specific line items are increasing or decreasing. So, is zero-based budgeting just lip service or were Abad and Jardeleza just mouthing things to defend the indefensible?
Pointed questions were asked by Justices Lucas Bersamin, Antonio Carpio and Arturo Brion. It was a withering scene where the DBM Secretary and Solicitor General often had stuttering and stammering episodes in answering questions from the Bench. But what probably got the jaded listener to stand up was when the Executive Duo said that DAP is functus officio or moot and academic. And that the Supreme Court need not rule anymore on the instant issue because the Executive had dumped DAP. In fact, the news over the weekend virtually became a distancing strategy, most especially for BSA3.
According to DBM Secretary Abad, it was the President’s idea to have DAP. No quibbling there. And we have a President who personally takes the shot from any and all for his KKK and here before the Bench, Abad dumped his President even while Justice Brion established later that Abad had expertise (cabinet secretary, years as legislators with Abad even volunteering he was chair of Appropriations Committee, DBM Secretary, etc). Even Memo Circular No. 541 was the subject of drilled questionings on intent and statutory construction. The concept of final abandonment by June was an issue that kept on being raised considering that a fiscal year is 12 months and the principle of obligation in budgeting has always been 2 years.
When you hear the DBM Secretary saying that to deal with slow-poked agencies, removal of budget is necessary, it shows the kind of management style they have. Imagine a budget removed from an agency by June of the fiscal year? Incredible! Then again, Abad and Jardaleza crossed the thin line when they said that the use of the power to augment non-existing items is no violation of the Constitutiton. I was shocked!
DAP is also about discretionary power. It’s how one uses savings and justifies its usage. An ordinary mind refers to it as juggling of funds! The Executive duo kept saying there is nothing to resolve since DAP has completed its task. I wonder what that task was since the timing is dubious. It’s as if all these storylines were being produced after the fact.
The post-DAP environment saw the following sections adopted in the 2014 General Appropriations Act (GAA): Sections 67, 68, 69, 70, and 71 of the General Provisions of Republic Act No. 10633 outlines the definition and rules in the use and realignment of Savings.
According to Section 68, Savings refer to “portions or balances of any programmed appropriation in this Act (2014 GAA) 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 appropriation balances arising from unpaid compensation and related costs pertaining to vacant positions and leaves of absence without pay; and (iii) from appropriation balances realized from the implementation of measures resulting in improved systems and efficiencies and thus enabled agencies to meet and deliver required for planned targets, programs and services approved in this Act at a lesser cost.”
The same section also limits augmentation to existing program, activity or project with appropriation in the GAA and prohibits the use of Savings to fund non-existing programs, activities and projects or to appropriations not authorized by the GAA.
The Supreme Court interprets and it should rule on DAP to lay down jurisprudence and guide the Executive and the Legislative Branches. More so, it should protect the taxpayers from patently unconstitutional acts. Not because the program ended means the Supreme Court can’t look into it. The more it should rule for reason and justice.
As a citizen, I recall Humpy Dumpy . . .