During the recent oral arguments at the Supreme Court on the alleged manipulation of the annual national budgets from 2023 onward, the magistrates pointed to an inescapable conclusion that politicking was dressed up as fiscal flexibility that contributed to the stunting of the economy.
Standby funds, contingent sources, and post-enactment transfers were all employed to generate pork barrel funds, stalling development goals that the General Appropriations Act (GAA) claimed to support.
In 2024 alone, the appropriations cover for P242 billion in foreign-assisted projects was withdrawn. The cover, or the counterpart funds, was needed to trigger the release of loan proceeds from overseas financiers.
Without congressional authorization of the funds, even fully disbursed foreign loans sit inert.
The Metro Manila Subway, financed substantially through foreign assistance, didn’t move that year, resulting in expenses due to the delay in drawing down the concessional lending.
Such projects offer generous terms, but they require counterpart funds to demonstrate commitment to completing the project.
Multilateral and bilateral creditors charge commitment fees, in the range of 1.5 to 2.5-percent annually, on undrawn balances to discourage governments from sitting on borrowed money.
It explains the escalation of costs of the Panay-Guimaras-Negros bridges, conceived in 1999 at a projected P28.5 billion, now carrying an estimated price tag of P300 billion, a more than tenfold increase due to a quarter-century of deferrals.
When Associate Justice Amy Lazaro-Javier pressed Solicitor General Darlene Bernabe on whether the bridge project qualifies as “important but not urgent,” which supposedly justifies parking funds in standby unprogrammed appropriations (UA) rather than the regular programmed budget, Bernabe waffled.
Bernabe couldn’t offer an answer, saying the matter required more study—an admission, in effect, that the line between “important” and “urgent” is wherever the executive and Congress need it to be in a given fiscal year.
Discretion is the problem at the center of the budget catastrophe. The special provisions embedded in the 2024, 2025, and 2026 GAA authorized the Department of Budget and Management to shuffle funds from one item to another after enactment, without the safeguards the Constitution demands.
Single projects, like the AFP modernization program, draw funding simultaneously from programmed appropriations, the UA, and, potentially, a third stream through supplemental budgets, further revealing where the Marcos administration’s priority lies.
A government with one ledger and one set of development goals doesn’t need three contingent pots of money chasing the same line item.
Foreign-assisted projects, tied to fixed disbursement schedules and real external creditors, aren’t built for that kind of flexibility—they’re built for predictability.
What the oral arguments laid bare, more than any single constitutional defect, is a budgeting culture in which discretion had become the rule rather than the exception.
The UA was meant to be a contingency mechanism for revenue windfalls. It was not conceived to be a parallel budget that Congress and the executive could dip into and rearrange long after the GAA had been passed. Treating foreign-funded infrastructure as a variable rather than a fixed obligation reflects how politicking came to outrank economic progress.
The High Tribunal must now decide whether the Constitution requires Congress to choose its priorities at the moment of legislation, or whether every important project has to wait on standby until political interest decides it’s finally time.