Don‘t trust Ralph

Don‘t trust Ralph | Daily Tribune

A closer examination of the manipulation of the yearly General Appropriations Act (GAA) since President Ferdinand Marcos Jr. took office makes it difficult to ignore the central role of Executive Secretary Ralph Recto.

When the Bicameral Conference Committeet(Bicam) inflated the Unprogrammed Appropriations (UA) to an unprecedented P731 billion, Recto, as then Batangas representative and deputy speaker, was a member of the panel.

It was also the time that the anomalous provision in the General Appropriations Bill (GAB) directing government-owned and controlled corporations (GOCC) to remit nearly P200 billion to the National Treasury to trigger the release of funds to the UA was inserted.

Retired Associate Justice Antonio Carpio said prosecuting Recto for taking the money would be difficult since the operation did not leave a paper trail, but letters he wrote as finance secretary may constitute the smoking gun against him.

Carpio said Recto wrote to PhilHealth, requesting the transfer of the funds to the National Treasury, as the funds would be used for government infrastructure projects under the UA, rather than for health services.

“Yes, oh my, there’s a record. The same thing happened with the PDIC because the letter was the same. That’s it,” Carpio said on the possibility of pinning Recto down for the budget fiasco.

Recto’s role in the conspiracy to create a pork barrel was very evident. The UA increased to an unprecedented P731 billion in the 2024 budget, compared with the National Expenditure Program (NEP) proposal of P281.9 billion.

The UA was stuffed with key items, including flagship infrastructure projects, to cover up for lawmakers’ pet projects, primarily flood control structures under the Department of Public Works and Highways (DPWH).

Special Provision 1(d) under Chapter XLIII (Unprogrammed Appropriations) of Republic Act 11975, the General Appropriations Act (GAA) of 2024, authorized the Department of Finance to identify and direct the remittance of “fund balances” or reserve funds from GOCCs to the Bureau of the Treasury.

The remitted funds were then used to fund items under the UA, which is triggered only when excess revenues become available under specified conditions.

On 12 January 2024, Recto became the finance secretary and issued Circular 003-2024, which ordered GOCCs (notably PhilHealth) to give up their excess funds.

Thus, Recto was part of the group that drafted the provision that was inserted in the budget, and then he executed it as finance secretary.

In a separate opinion, Supreme Court Associate Justice Ramon Paul Hernando, in junking the Recto maneuver to draw the P89.9 billion from PhilHealth, said the UA was unconstitutional because the projects it listed were not supported by a budget of expenditures and funding sources.

The Constitution is explicit about the GAA being based on a budget of expenditures and financing sources. The bicam, which included Recto in 2024, added another source of UA funding in addition to excess revenues and borrowings, namv ely, the excess funds of GOCCs.

“That’s why they took money from PhilHealth. Because that was sure, there was money there. If they just relied on excess revenues from taxes, non-taxes and dividends, that was not certain. So what they did was they added another item, another source — the excess funds of GOCCs,” Carpio pointed out.

“They cannot take that. That is a trust fund. The Philippine Insurance Deposit Corp. (PDIC) is also a trust fund. That is the depositors’ money,” Carpio said.

The transfer of excess funds is not permitted under the Constitution.

Carpio stressed: “No law shall be passed authorizing the transfer of appropriations. There is an exception only when there are savings and only the President may transfer savings. (Those excess funds were) not savings.”

Recto’s guarantee that the 2026 budget is pork-free, supposedly because of tighter safeguards, may merely reflect a recalibrated strategy for looting public funds.