With all the fuss about budget impoundment during the former Philippine President Gloria Macapagal-Arroyo’s Regime, let us first define what it means. According to an on-line legal dictionary, budget impoundment is “ an action taken by the president in which he/ she proposes not to spend all or part of a sum of money appropriated by Congress.” This was practiced in the United States Government. There were instances when the original purpose for the appropriations were no longer available or the appropriated sum could be saved through more efficient operations. In this case, Congress simply gave in to the president’s wishes. There were also other situations when Congress or the designated recipient of the impounded funds challenged the president’s action. Both parties tried to settle these political issues through negotiations.
Past presidents, like Thomas Jefferson impounded funds at various times for various reasons, without pitting the executive and the legislative branches against each other. The current rules and procedures for impoundment were created by the Congressional Budget and Impoundment Control Act of 1974 (2 U.S.C.A. or the United States Code Annotated § (Section) 601 et seq.). The Act was passed to reform the congressional budget process and to resolve conflicts between Congress and then President Richard M. Nixon concerning the Executive Branch’s power to impound funds appropriated by Congress.
In the Philippines, the act of budget impounding was first enacted under former President Ferdinand Marcos. Section 43 of Presidential Decree No. 1177, as amended or the “Budget Reform Decree of 1977 is quoted as follows:
“Suspension of expenditure of Appropriations. Except as otherwise provided in the General Appropriations Act and whenever in his judgment the public interest so requires, the President, upon notice to the head of office concerned, is authorized to suspend or otherwise stop further expenditure of funds allotted for any agency, or any other expenditure authorized in the General Appropriations Act, except for personal services appropriation used for permanent officials and employees.
The late President Corazon C. Aquino also inserted the impounding of appropriations through Section 38, Book VI of the 1987 Revised Administrative Code of Executive Order No. 292 stating the following:
“Suspension of Expenditure of Appropriations. Except as otherwise provided in the General Appropriations Act and whenever in his judgement the public interest so requires, the President, upon notice to the head of office concerned, is authorized to suspend or otherwise stop further expenditure of funds allotted for any agency, or any other expenditure authorized in the General Appropriations Act, except for personal services appropriations used for permanent officials and employees.”
Impounding the budget was directly specified under Gloria Macapagal-Arroyo’s Administration in Section 67 of Republic Act No. 9970 or the General Appropriations Act of 2010 as quoted below:
” Section 67. Prohibition Against Impoundment of Appropriations. The President shall release all budgetary allocations provided for in the GAA, except in the following circumstances: a) when the President submits a proposal to Congress to impound or permanently withhold the release of a particular appropriation item and Congress does not act on the proposal within forty-five calendar days from its submission to the Senate President and the Speaker of the House of Representatives, unless during the said period the Congress by a Concurrent Resolution denies or rejects the proposal by a vote of a simple majority of the quorum: PROVIDED, HOWEVER, That the time covered by the periodic adjournments of Congress shall not be reckoned in the computation of the 45-day period; and b) when the President temporarily defers the release of a particular appropriation item upon prior written notice to Congress, through the Senate President and the Speaker of the House of Representatives, which deferment shall subsist unless Congress stops or rejects the deferment in a Concurrent Resolution adopted by a simple majority of the quorum.”
There was a conditional veto, stated in Arroyo’s Veto Message of February 8, 2010, located at the last part of the General Appropriations Act or Republic Act No. 9970. The 18-page veto message to Congress, Mrs. Arroyo made a conditional veto of prohibiting the withholding of appropriations like the Priority Development Assistance Fund (PDAF), the modern term for pork barrel. But the P64.6 billion appropriations by Congress for the payment of the Philippines’ debt obligations were withheld, including the powers of the Members of Congress to have a say on the construction of farm-to-market roads.
Opposition members of Congress have criticized this strategy of Arroyo as a means of diverting funds for her electoral campaign for a congressional seat of the Second District of Pampanga Province.
Note: Presidential Decree No. 1177 amended by Presidential Decree No. 1421
1. Presidential Decrees
a. Presidential Decree No. 1177 (Budget Reform Decree)
Official Gazette volume 73, number. 41, page 9548
(Issue date: 10/10/1977)
b. Presidential Decree No. 1421
Official Gazette volume 74, no. 42, page 8257
(Issue Date: October 16, 1978)
c. Republic Act No. 9970 (General Appropriations Act 2010)
Official Gazette volume 106, number 1
(Special Edition Issue Date: February 12, 2010)
d. Executive Order No. 292 (1987 Revised Administrative Code)
Official Gazette Supplement volume 83, number 31,
(Issue Date: August 3, 1987)
B. Articles (URL Websites):