Category Archives: General Appropriations Acts

Budget Impoundment in the General Appropriations Act (GAA) of 2010

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

 

Related Links:

A.    Laws

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,

        pages 3528-138

        (Issue Date: August 3, 1987)

 B.    Articles (URL Websites):

 http://www.newsflash.org/2004/02/pe/pe004798.htm

http://www.newsflash.org/2004/02/be/ b3004227.htm

http://www.beta2.philstar.com/headlines/537926/gma-banned-by-allies-from-impounding-pork.htm

 

 

 

 

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Filed under Budget Impoundment, General Appropriations Acts, Impoundment of Appropriations

General Appropriations Act : Legislated Issuances On Authorized Deductions

Have you, as a Philippine government employee, tried to take out a loan from your office’ cooperative, mutual fund, HDMF (the administrator of the Pag-ibig housig funds) and the GSIS (government pension fund office), only to be declined?  This is due to a provision in the General Appropriations Act (GAA) stating that when an employees’ net take home pay is less than P5,000, they could no longer loan from these funding entities.  Section 37 entitled “Authorized Deductions” of the GAA of 2012.  The 2012 GAA which was enacted through Republic Act No. 10155 authorizes deductions from   a government employee’s salary, as long as their total deductions shall not go below P5000.

Prior to 2012, an employee’s net take home pay should not go below P3,000.  This has been stated in Sections 36 and 41 of the GAA of 2002 and 2008, respectively.   The GAA OF 2002 and 2008 was enacted through Republic Act Nos. 9162 and 9498, respectively. 

Below are the provisions of the GAAs relative to Authorized Deductions:

General Provisions on Authorized Deductions in the General Appropriations Act (GAA)

General Appropriations Act, 2002 (REPUBLIC ACT NO. 9162)

Section 36. Authorized Deductions. – Deductions from salaries, emoluments or other benefits accruing to any government employee chargeable against the personal services appropriation authorized in this Act may be allowed for the payment of obligations due the GSIS, HDMF, PHIC and other Government Financial Institutions, the Bureau of Internal Revenue and those specifically allowed by existing laws: Provided, That the agencies and offices with existing deductions arrangements with private lenders and cooperatives shall continue such deductions until the credits/loans outstanding or the premiums of the policies in force at the date of passage of this Act or, December 31, 2001 whichever comes later, shall have been fully paid: Provided, further, That such deductions shall not reduce the employee’s monthly net take home pay to an amount lower than Three Thousand Pesos (P3,000.00), after all authorized deductions. It shall be unlawful for departments, bureaus, offices and agencies to collect any form of service fees for the payment of any obligation through authorized deductions.

General Appropriations Act,  2008 (REPUBLIC ACT NO. 9498)

Section 41.  Authorized Deductions …“deductions from salaries, emoluments or other benefits accruing to any government employee chargeable against the appropriations for personal services may be allowed for the payment of individual employee’s contributions or obligations due the following:      a. The BIR, GSIS, HDMF and PHIC;b. Mutual benefits associations duly operating under existing laws which are managed by, and for the benefit of, government employees not covered by compulsory membership in the GSIS; and c. Associations / cooperatives organized and managed by government employees for their benefit and welfare.      PROVIDED, That such deductions shall not reduce the employee’s monthly net take home pay to an amount lower than Three Thousand Pesos (P3,000.00), after all authorized deductions: PROVIDED FURTHER, That in the event total authorized deductions shall reduce net take home pay to less than Three Thousand Pesos (P3,000.00), authorized deductions under item (a) shall enjoy first preference, those under item (b) second preference, and so forth.”        

GENERAL APPROPRIATIONS ACT 2012  (REPUBLIC ACT NO. 10155)

       Section 37. Authorized Deductions.  Deductions from salaries, emoluments or other benefits accruing to any government employee chargeable against appropriations for Personal Services may be allowed for the payment of individual employee’s contributions or obligations due the following:

(a)  The BIR, Philhealth, GSIS, and HDMF;

(b) Mutual benefits associations, thrift banks and non-stock savings and loan associations duly operating under existing laws which are managed by and/or  for the benefit of government employees;

(c)  Associations/cooperatives/provident funds organized and managed by government employees for their benefit and welfare; and

(d) Duly licensed insurance companies accredited by national government agencies.

PROVIDED, That such deductions shall not reduce the employee’s monthly net take home pay to an amount lower than Five thousand Pesos (P5,000), after all authorized deductions: PROVIDED FURTHER, That in the event total authorized deductions shall reduce net take home pay to less than Five Thousand Pesos (P5,000), authorized deductions under item (a) shall enjoy first preference, those under item (b) shall enjoy second preference, and so forth.

Source:

Philippine Laws

1.     Republic  Act No. 9162 (General Appropriations Act 2002)

        (No Official Gazette Source)

2.     Republic  Act No. 9498 (General Appropriations Act 2008)

(Official Gazette Hard Copy Only)

         Official Gazette volume 104, no. 1

         (Issue Date: March 16, 2008)

3.     Republic Act No. 10155 (General Appropriations Act 2012)

 

http://www.gov.ph/2012/01/01/republic-act-no-10155/

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Filed under Authorization of Deductions, Authorized Deductions, General Appropriations Acts