Archive for the ‘Constitutional Law’ Category

DAP and The Power of the Purse

In the rather recent case of Araullo v. Benigno Simeon Aquino III[1], involving the chronically divisive Disbursement Acceleration Program  (or the DAP), the Supreme Court adopted a strict review of the “savings” definition to determine the President’s power to transfer amounts between programs under the General 2011, 2012 and 2013 Appropriations Act. On the flip side, the Supreme Court refused to consider the DAP as an impoundment measure based on the narrow definition of Impoundment under the same years GAAs:

 “The petitioners assert that no law had authorized the withdrawal and transfer of unobligated allotments and the pooling of unreleased appropriations; and that the unbridled withdrawal of unobligated allotments and the retention of appropriated funds were akin to the impoundment of appropriations that could be allowed only in case of “unmanageable national government budget deficit” under the GAAs, thus violating the provisions of the GAAs of 2011, 2012 and 2013 prohibiting the retention or deduction of allotments.

In contrast, the respondents emphasize that NBC No. 541 adopted a spending, not saving, policy as a last-ditch effort of the Executive to push agencies into actually spending their appropriations; that such policy did not amount to an impoundment scheme, because impoundment referred to the decision of the Executive to refuse to spend funds for political or ideological reasons; and that the withdrawal of allotments under NBC No. 541 was made pursuant to Section 38, Chapter 5, Book VI of the Administrative Code, by which the President was granted the authority to suspend or otherwise stop further expenditure of funds allotted to any agency whenever in his judgment the public interest so required.
The assertions of the petitioners are upheld. The withdrawal and transfer of unobligated allotments and the pooling of unreleased appropriations were invalid for being bereft of legal support. Nonetheless, such withdrawal of unobligated allotments and the retention of appropriated funds cannot be considered as impoundment. According to Philippine Constitution Association v. Enriquez (citation omitted): “Impoundment refers to a refusal by the President, for whatever reason, to spend funds made available by Congress. It is the failure to spend or obligate budget authority of any type.” Impoundment under the GAA is understood to mean the retention or deduction of appropriations. The 2011 GAA authorized impoundment only in case of unmanageable National Government budget deficit, to wit:

Section 66. Prohibition Against Impoundment of Appropriations. No appropriations authorized under this Act shall be impounded through retention or deduction, unless in accordance with the rules and regulations to be issued by the DBM: PROVIDED, That all the funds appropriated for the purposes, programs, projects and activities authorized under this Act, except those covered under the Unprogrammed Fund, shall be released pursuant to Section 33 (3),Chapter 5, Book VI of E.O. No. 292.

Section 67. Unmanageable National Government Budget Deficit. Retention or deduction of appropriations authorized in this Act shall be effected only in cases where there is an unmanageable national government budget deficit. Unmanageable national government budget deficit as used in this section shall be construed to mean that (i) the actual national government budget deficit has exceeded the quarterly budget deficit targets consistent with the full-year target deficit as indicated in the FY 2011 Budget of Expenditures and Sources of Financing submitted by the President and approved by Congress pursuant to Section 22, Article VII of the Constitution, or (ii) there are clear economic indications of an impending occurrence of such condition, as determined by the Development Budget Coordinating Committee and approved by the President.

The 2012 and 2013 GAAs contained similar provisions.

The withdrawal of unobligated allotments under the DAP should not be regarded as impoundment because it entailed only the transfer of funds, not the retention or deduction of appropriations.”

This means that while the Court recognized that the power to define savings is primordially legislative, it also allowed wide leeway for the Executive to play around with appropriations in order to create savings. In other words, although the President, if allowed by law (remember that it is not an inherent power), can realign only those funds which are defined as “savings” by Congress, it seems that he can also create a new category of savings altogether by simply “withdrawing unobligated allotments”  and the act of withdrawing itself is not considered an impoundment within the statutory definition.

I for one am still on the fence regarding the DAP issue per se but I think this distinction made by the Supreme Court on the impoundment aspect is too sophisticated for its own good. DAP would allow the executive to  declare an allotment “unobligated” merely by cherry picking which PAPs to obligate. And that precisely is the essence of impoundment — the refusal of the executive to carry out an instruction by Congress.

The items in the appropriations act are permissions for the Executive to incur obligations for the corresponding items. At the same time, the  GAA also theoretically contains a corresponding negative instruction for the President NOT to incur obligations for programs where no appropriations were made by Congress. Thus, to the extent that President acts contrary to these instructions, can it not be said that he also violates his duty to “faithfully execute” the laws of the land?

Finally, I think that obligating items PRIOR to or independent of the GAA amounts to a kind of “executive appropriation” as it would have the unusual effect of forcing the legislature to enact an appropriation to cover the expenditure,  thus:

“While section 8 of article I enumerates the powers of the legislative branch, the appropriations clause in section 9 is not a grant of power.

Rather, the appropriations clause affirmatively obligates Congress to exercise a power already in its possession.

Congress’ power to appropriate originates in article I, section 8. The concept of “necessary and proper” legislation to carry out “all . . . Powers vested by this Constitution in the Government of the United States” includes the power to spend public funds on authorized federal activities

Article I, section 8 also grants Congress the obverse power: the power to prevent the spending of any public funds except as authorized by Congress.

That is, even if there were no appropriations clause in the Constitution, Congress would have the power to enact a statutory “appropriations clause,” worded exactly the same as the clause in article I, section 9, making Congress’ appropriations power exclusive. If Congress could not prohibit the Executive from withdrawing funds from the Treasury, then the constitutional grants of power to the legislature to raise taxes and to borrow money” would be for naught because the Executive could effectively compel such legislation by spending at will.

The `legislative Powers’ referred to in section 8 of article I would then be shared by the President in his executive as well as in his legislative capacity.

Since legislative appropriations power is rooted in article I, section 8, we may infer that a primary significance of the appropriations clause in section 9 lies in what it takes away from Congress: the option not to require legislative appropriations prior to expenditure. If the Constitution thus strictly forbids `executive appropriation’ of public funds, the exercise by Congress of its power of the purse is a structural imperative[2]. “

 

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[1] GR No. 289207

[2] Stith, Kate, “Congress’ Power of the Purse” (1988). Faculty Scholarship Series. Paper 1267. http://digitalcommons.law.yale.edu/fss_papers/1267

 

 

 


Dynasties and Restricting the “Right to Run”

The dominant argument against the passage of legislation banning political dynasties is that no person should be deprived of his right to run for public office solely on the basis of his family name.  The argument contains two (2) angles: (i)  the scope of Congress’ authority to impose restrictions on the right to run and (ii) an “equal protection”  angle, both of which we will discuss in this article.

Driving our hook  directly into the flanks of these dual objections, it should be said right away that there is no Constitutional provision which specifically grants an individual any “right to run for public office.”    Nevertheless, the view has been expressed that the right “touches on” both the freedom of expression and freedom of association clauses of the Constitution. This reasoning is based on Mancuso vs. Taft [476 F2d 187 (1972)] where it was ruled that “any legislative classification that significantly burdens [the candidacy] interest must be subjected to strict equal protection review.”

In 2010 however, the Philippine Supreme Court denied application of the Mancuso doctrine, pointedly observing that the case had been overturned. More importantly, it declared that “’[t]he First Amendment does not in terms confer a right to run for public office, and this court has held that it does not do so by implication either.’ Thus, one’s interest in seeking office, by itself, is not entitled to constitutional protection” [Quinto v. Comelec, GR No. 189698 (citing Bart v. Telford, 677 F2d 622)]. Consequently, instead of  the “strict review” favored by Mancuso, the Court limited itself to a “balancing of interests” approach in determining the validity of a legislation limiting candidacy interest [1].

The implications of the Quinto ruling are that: (a) the so-called “right to run” is NOT a fundamentally protected right in the same category as the freedoms of expression and association; and (b) Congress may validly restrict a person’s “interest” to run for office provided only  that the limitations “[s]ubstantially serve governmental interests”  [Supra.]. In the case of putative anti-political dynasty legislation, the “governmental” or “state interest” involved is supplied by no less than  the Constitution itself, particularly the right to “equal access to opportunities for public service” under Article II, Section 26 to wit:

“Section 26. The State shall guarantee equal access to opportunities for public service, and prohibit political dynasties as may be defined by law.”

It may be worth mentioning now, if only for the sake of leaving no stone unturned, that there is another case [Powell vs. McCormack, 395 US 486 (1969)] where the US Federal Supreme Court ruled  that  “[t]he Constitution leaves the House xxx without authority to exclude any person, duly elected by his constituents, who meets all the requirements for membership expressly prescribed in the Constitution.”  The issue in Powell however, involves an interpretation of the authority of the two houses to be the “judge” of the qualifications of its members. It was held that this authority (of the Lower House) cannot be extended so as to allow the exclusion of a candidate, not otherwise disqualified by the Constitution, from taking his seat after being elected by his constituents. Therefore, the Powell ruling does not affect the authority of the Legislature to impose qualifications in addition to those already provided for in the Constitution BEFORE the candidate is elected or chooses to run. Besides again, our  Constitution (via the cited Section 26) itself directs Congress to require non-membership in a political dynasty as an additional qualification for candidates seeking to hold elective office.

Finally, I think that Quinto effectively disposes of the equal protection challenge against anti-political dynasty legislation in general.  Citing an earlier case (Farinas v. Executive Secretary,[GR No. 147387 (2003 )], the Court held that a “legal dichotomy” between the treatment of different classes is valid where substantial distinctions exist between the classes as to justify unequal treatment, to wit:

“The equal protection of the law clause in the Constitution is not absolute, but is subject to reasonable classification. If the groupings are characterized by substantial distinctions that make real differences, one class may be treated and regulated differently from the other. The Court has explained the nature of the equal protection guarantee in this manner:

 ‘The equal protection of the law clause is against undue favor and individual or class privilege, as well as hostile discrimination or the oppression of inequality. It is not intended to prohibit legislation which is limited either in the object to which it is directed or by territory within which it is to operate. It does not demand absolute equality among residents; it merely requires that all persons shall be treated alike, under like circumstances and conditions both as to privileges conferred and liabilities enforced. The equal protection clause is not infringed by legislation which applies only to those persons falling within a specified class, if it applies alike to all persons within such class, and reasonable grounds exist for making a distinction between those who fall within such class and those who do not.

Indeed, there does appear to be ample reason to treat members of political dynasties differently from the non-dynastic candidates. Two related studies of the Asian Institute of Management Policy Center (one a follow up of the other) suggest strong numerical correlation between poverty and incidence of dynasties. More particularly, the studies showed that there were more dynastic Congressmen in “regions with higher poverty, lower human development and more severe deprivation” [Mendoza, Beja, Vernida and Yap, An Empirical Analysis of Political Dynasties in the 15th Philippine Congress (January 1, 2012)] [2] Another  study (also made by the AIM Policy Center) of the 2013 Philippine Mid-Term Elections provided numerical evidence that suggests that President Aquino and Vice President Binay significantly helped to deliver votes to their relatives Bam Aquino and Nancy Binay. Of Noynoy Aquino and Bam Aquino, for instance, the study [3] observed that:

“President Aquino’s votes in 2010 turned out to be one of the strongest determinants of Senator Aquino’s votes in 2013. That variable is positive and statistically significant, indicating that support for the President may have also been reflected strongly in support for Senator Aquino. A 1 percentage point increase in the share of votes for President Aquino at the provincial level, translated into a 0.29 percentage point increase in the votes for his cousin, Bam Aquino.”

 

 

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[1]  Quinto v. Comelec (supra) involved the validity of a “deemed resigned” provision (Section 4(a) of Comelec Resolution 8678, enforcing the prohibition against partisan politics by civil service employees, to wit:

‘Incumbent Appointive Official– Under Section 13 of RA 9369, which reiterates Section 66 of the Omnibus Election Code, any person holding a public appointive office or position, including active members of the Armed Forces of the Philippines, and officers and employees in government-owned or -controlled corporations, shall be considered ipso facto resigned from his office upon the filing of his certificate of candidacy.

 ‘Incumbent Elected Official– Upon the other hand, pursuant to Section 14 of RA 9006 or the Fair Election Act,which repealed Section 67 of the Omnibus Election Code[18] and rendered ineffective Section 11 of R.A. 8436 insofar as it considered an elected official as resigned only upon the start of the campaign period corresponding to the positions for which they are running, an elected official is not deemed to have resigned from his office upon the filing of his certificate of candidacy for the same or any other elected office or position. In fine, an elected official may run for another position without forfeiting his seat.

[2] http://dx.doi.org/10.2139/ssrn.1969605

[3] Canare, Lopez, Mendoza  and Yap. The 2013 Mid Term Elections: An Empirical Analysis of Dynasties, Vote Buying and the Correlates of Senate Votes,  (February 2014). Posted in: http://www.kapatiranparty.org/wp-content/uploads/2014/02/The-2013-Philippine-Mid-Term-Election-An-Empirical-Analysis-of-Dynasties-Vote-Buying-and-the-Correlates-of-Senate-Votes.pdf