Public trust, constitutional responsibility

At a time when the nation is closely examining the use of public funds, the Supreme Court (SC) has issued a timely reminder that the national budget is a public trust. As the Court observed, “every peso collected in taxes and fees represents labor rendered, needs deferred, perseverance, and sacrifice endured by our people.”

In the consolidated petitions involving Pimentel III v Bersamin and related cases (G.R.s 271059, 271347, E-02472 and E-04036, 7 October 2026), the Supreme Court En Banc, through Senior Associate Justice Marvic M.V.F. Leonen, clarified the constitutional safeguards governing Unprogrammed Appropriations under the 2024, 2025 and 2026 national budgets.

Unlike programmed appropriations, which cover expenditures supported by planned revenues and financing, Unprogrammed Appropriations are standby spending authorizations. They may be released only upon the occurrence of specified funding conditions. They are not funds automatically available for expenditure.

The Court emphasized that Unprogrammed Appropriations are not unconstitutional per se. Indeed, they provide the government with the necessary flexibility to address unforeseen domestic and global developments. However, their use must remain faithful to constitutional limitations and the national fiscal program.

First, Unprogrammed Appropriations must not contain prohibited lump sums. Congress must sufficiently identify the purposes and amounts of expenditures rather than leave essential allocation decisions entirely to the Executive. This safeguards both the constitutional separation of powers and the President’s authority to veto particular appropriation items.

Second, additional collections from one revenue source do not necessarily mean that the government has surplus funds. Other sources may have fallen short of expectations. Accordingly, new revenues should presumptively support programmed expenditures, unless clear and convincing reasons justify their allocation to unprogrammed purposes.

Third, Congress must establish sufficient standards for prioritizing expenditures when available funds cannot cover every listed purpose. Such standards guide implementation while preserving Congress’s constitutional power of the purse.

Fourth, Unprogrammed Appropriations must remain narrowly contingent and consistent with the national fiscal program. Their standby character cannot become a means of authorizing spending without adequate fiscal justification.

The SC, likewise, clarified that the constitutional prohibition against Congress increasing the President’s recommended appropriations applies to programmed and unprogrammed expenditures taken together. This ceiling cannot be avoided simply by placing additional amounts under Unprogrammed Appropriations.

Applying these principles, the Court invalidated challenged increases and provisions in the 2024 and 2025 budgets, including a prohibited lump-sum item. It also struck down provisions of the 2026 budget allowing releases based on specified new or excess revenues without adequate safeguards. The doctrine of operative fact nevertheless protects qualifying completed acts undertaken in good faith.

The Court further reminded the Bicameral Conference Committee of the importance of transparency and of observing the limits of its authority when reconciling disagreements between the two chambers.

These rulings should be viewed not as obstacles to effective governance, but as valuable guidance for sounder budgeting. Constitutional safeguards strengthen, rather than diminish, the government’s capacity to serve the people responsibly.

It is our earnest hope that Congress and the Executive will faithfully incorporate these principles in future budgets and their implementation. With transparency, discipline and cooperation among our institutions, every public peso can more effectively fulfill its intended purpose: improving the lives of the Filipino people.

For more of Dean Nilo Divina’s legal tidbits, please visit www.divinalaw.com. For comments and questions, please send an email to cad@divinalaw.com.