Palace spending program 'illegal'

MANILA, Philippines – “This is a crime!”

Former Senator Joker Arroyo said there is no other way to call Malacañang’s release of P1.107 billion to select lawmakers supposedly to boost government spending because it is not covered by law.

Another legal luminary, Sen Miriam Defensor Santiago, also branded the executive branch’s Disbursement Acceleration Program (DAP) as illegal, saying it undermines Congress’ power of the purse.

The fund is an invention of the Palace, said Leyte Rep Ferdinand Martin Romualdez, who heads the independent bloc in the House: “What is the legal basis for its existence? We have not heard of this animal.”

The DAP had been identified by the budget department as the source of funds released to select senators following the conviction of former Chief Justice Renato Corona in May 2012.

It was the Palace’s way of countering the impression created by Senator Jinggoy Estrada’s speech last week that the Palace rewarded senators who voted to convict Corona by giving them additional Priority Development Assistance Fund (PDAF).

The PDAF or pork barrel, unlike the DAP, is appropriated in the budget law. It has become controversial following findings by government investigators that billions of pesos in PDAF went to fake non-governmental organizations that gave lawmakers hefty kickbacks.

Budget Secretary Florencio Abad later admitted that an average of P50 million was released to each of 20 senators in 2012 but stressed that the money was not a bribe. Abad said that starting 2011, the DAP aimed to address government underspending then blamed for the country's sluggish economic growth. He said DAP releases "helped buoy the economy from 2011 to 2012." 

Senate President Franklin Drilon admitted as well that he received P100 million, while Speaker Feliciano Belmonte Jr said congressmen got P10 million each. Both denied the releases were related to the Corona trial.

An invention of DBM

Already retired from politics, former Senator Arroyo returned to the Senate on Tuesday to hold a press conference criticizing the DAP and what he called the “student council in Malacañang.”

Calling the DAP “an invention of the Department of Budget and Management” (DBM), he said a law, not a mere executive order, is needed to create it.

“The DAP is a creation of the DBM. Being a mere creation, that is illegal and the disbursements from the DAP are also illegal. They cannot do that without a supporting law,” said Arroyo, a prominent human rights lawyer during the Martial Law days.

Arroyo added: “Yes, the President has the power to use the savings but there is that phrase, ‘in accordance with law.’ There are these guidelines.”

“How much has been disbursed already coming from the DAP? Because PDAF they say is no good but DAP is worse. PDAF has a legal standing. It was created by law, it was in the General Appropriations Act but the DAP is not,” Arroyo said.

“This is a crime,” Arroyo exclaimed. “That is money. You cannot release money without any legal support. That is cardinal.”

Arroyo though refused to say what crime was committed. Asked if the DBM or the senators are liable, he said, “Bahala na ang student council diyan,” referring to the President's advisers, whom he had always criticized for being amateur. (It's up to the student council.)

Arroyo said he spoke up about the issue after Abad “lumped him together” with the senators who voted to convict Corona. Out of 23 senators, only Arroyo, Santiago, and Sen Bongbong Marcos voted for acquittal. Arroyo got P47 million in DAP but only in February 2013.

P500M for senators during Corona trial

Arroyo said that on top of the P1.107 billion DAP, senators got P500 million during the impeachment trial.

“At the height of impeachment trial, about April, over P500 million was taken from the PDAF, not DAP, and given to I think 11 senators. Then later on after the impeachment, another P1 billion was taken from the DAP. Where did this come from?” Arroyo said.

“We cannot just forget that. We cannot just say that’s nothing,” the former senator said.

Arroyo said he found out about the P500 million given during the impeachment trial from the DBM website. Unlike Santiago, though, he refused to call it a bribe.

“I cannot pass judgment. My concern is money is moving while the trial was going on and after the trial. I will only go up to that extent and say in so far as the releases from DAP [are concerned], they were all illegal.”

MONEY MOVING. Former Sen Joker Arroyo refuses to say whether there was bribery for Corona's conviction but he said u0022money was moving during and after the trial.u0022 Photo by Ayee Macaraig/Rappler

MONEY MOVING. Former Sen Joker Arroyo refuses to say whether there was bribery for Corona's conviction but he said u0022money was moving during and after the trial.

u0022 Photo by Ayee Macaraig/Rappler

No record of amendments

Arroyo also said he was not aware that the P47 million allotted to him came from the DAP.

He explained that he requested for P47 million during the period of amendments of the budget last year to fund 7 hospitals and 3 schools in his home province of Camarines Sur. Yet then finance committee chairman Sen Franklin Drilon told him he will just “take care of that.”

“I asked Senator Drilon, I will introduce an amendment. He said, ‘Never mind. Just give me a piece of paper, I’ll take care of that.’ The idea was no more debate so I gave him a piece of paper and that’s it."

“Suddenly it comes out. The funding of P47 million was not a budget amendment pero gawa-gawa lang diyan sa DBM (but just a creation of DBM). Had I known that, I wouldn’t agree even if it’s my amendment because I don’t like PDAF, what more with this DAP?”

Abad has said that former Senator Arroyo’s budget amendments were not approved, and Arroyo’s request was endorsed to the executive for funding because they were “in line with President Aquino’s thrust of providing quality education and health services for the country’s underprivileged.”

Arroyo said Congress has long had this questionable practice of keeping no records of budget amendments.

“Look whether there's recording of amendments, zero. I dare say this because there is none. Yet what was disposed of were millions, trillions of pesos. This is serious, we cannot just let this go,” he said.

‘Huge pork barrel of the President’

In a separate statement, Senator Santiago echoed Arroyo in questioning the legality of the DAP. She said the DBM “is chipping away at the legislative power of the purse by fiddling with the budget.”

“The Budget Secretary released a list of the beneficiaries of the DAP.  The variance of the beneficiaries – lumping together P10 billion to the National Housing Authority, with P50 million for every senator in 2012 – indicates that the DAP is nothing more or less than the huge pork barrel of the President, spent without the participation of the Congress,” said Santiago, a constitutional expert and former trial court judge. 

Santiago said the DAP violates the constitutional provision that “No law shall be passed authorizing any transfer of appropriations; however, the President…may by law, be authorized to augment any item in the general appropriations law for their respective offices from savings in other items of their respective appropriations.”

She said the Constitution allows fund transfers only if there are savings, “meaning that the project was completed and yet the appropriation was not exhausted. But there are no savings if a project was merely deferred.”

The senator said it appears the DAP was taken from “alleged slow-moving projects” and so no savings were generated, making the DAP illegal.

“The first issue is that the DAP was not taken from savings. The second issue is that the DAP was not used to augment items in the budget that were previously authorized by Congress. The alleged savings were used to augment new budget items not previously authorized by Congress,” she said.

‘Refile Aquino bill’

To address what she called a flawed budget system, Santiago said Congress must pass a law similar to the US 1974 Congressional Budget and Impoundment Control Act.

She said the law requires the President to seek congressional approval for cancelling or cutting back appropriated funds for a project no longer necessary.

Ironically, she said President Benigno Aquino III authored a bill proposing the Budget Control and Impoundment Act.

“President Aquino’s proposed impoundment law takes a fiscally responsible position. If he doesn’t mind, I will simply refile it in the Senate, with an explanatory note that it was originally filed by President Aquino,” Santiago said.

“How were the new budget items arrived at? Where did all these monies go? Which were the provinces, cities, and towns? Who were the service providers? Were they chosen thru competitive bidding? And who were the real beneficiaries?”

The COA said it is already auditing the DAP– Rappler.com