ABUSE OF POWER

Yet, even without the Revilla initiative at the Senate, Guingona’s proposal is not really a new idea. Similar bills had been filed in previous congresses, but none prospered.

Guingona says his bill was inspired by the U.S. Impoundment Control Act of 1974, which was triggered by serious doubts that then President Richard Nixon was abusing his power to put on hold the release of funds for programs he did not like.

The U.S. law created the congressional budget office and established procedures for developing an annual budget plan. It put in place safeguards to prevent the executive department from using the budget as a political tool.

Revilla’s bill, for instance, notes that in 1992, only P270.63 billion of the P334.55 billion budget was released, leaving P63.92 billion or roughly 20 percent impounded or unreleased. The implication? The impounded amount could have been used to dispense political favors.

The innocent-looking entry in the annual budget called “overall savings” makes Guingona suspicious, especially when the previous year’s budget is re-enacted and the administration generates substantial savings that can be used for political purposes.

SAVINGS OR WAR CHEST?

In his analysis of the annual budget programs, Guingona points out that savings in 2005 soared to 17.36 percent, from 0.94 percent in the previous year. The government operated in 2004 on a re-enacted budget of 2003.

The situation was almost the same in 2007 when savings reached 16.71 percent, from 0.20 percent in 2006 when the 2005 budget was re-enacted.

This time, Guingona notes a disturbing P106.11-billion “overall savings” in the 2009 budget. The amount, he says, can find its way into the administration’s “war chest” for the 2010 elections.

The money came from unreleased or unused allocations for agencies and lumped into “savings,” which can then be transferred to favored offices. It is in this process where “abuse of savings” comes in, Guingona says.

There are many reasons why appropriated funds are not released. One is an agency’s non-compliance with the documentary requirements of the Department of Budget and Management. Politics is another, such as what happens when the presidency withholds “pork barrel” allocations for congressional districts of legislators perceived to be “unfriendly” to the powers that be.

“Mukhang sinasadya yata ang re-enacted budget (It looks like the re-enacted budget is no accident),” remarks Guingona. “Kapag tinamad ang Congress, kapag nag-order ang presidente, re-enact na lang ang budget (When Congress gets lazy and the president issues an order, the budget is re-enacted just like that).”

With a re-enacted budget, he explains, the president gets what he calls for emphasis as “beef barrel,” as compared to the lawmakers’ “pork barrel.”

This is where, he insists, the impoundment control measure is necessary to stop the executive from transferring appropriated funds from one agency to another through a circuitous process. And this, he says, is what happened with the controversial fertilizer funds in 2004.

TOO MANY LUMP SUMS

Benjamin Diokno, who served as budget secretary to former Presidents Corazon Aquino and Joseph Estrada, says the practice of overstating revenues also gives the president the excuse to generate savings from certain agencies while augmenting the budget of other departments.

This effectively weakens the power of Congress over the purse because the president can choose which projects to fund and which not to fund, oftentimes setting aside the priorities of legislators.

Diokno, an economics professor at the University of the Philippines, warns of possible abuses in the disbursement of many lump sum items or Special Purpose Funds in the proposed 2009 budget.

Guingona himself notes that a whopping 87 percent of the annual budget goes to lump sum appropriations, largely for debt payments. That leaves only 13 percent for Congress to appropriate, or to play around with. Worse, more than half or 60 percent of the 13 percent is in Special Purpose Funds where proposed spending is not itemized, thus making it difficult to track.