It’s too early to say how much of what former Ako Bicol representative Zaldy Co said in his explosive video statement is true. They are however at least plausible. However much is true, this implicates Pres. Bongbong Marcos Jr in gross fiscal malpractice.
Unprecedented numbers of Filipinos have become more familiar with the national government budget process since the president’s sensational “Mahiya naman kayo!” outburst in July – this is a great leap forward for transparency and in the public’s ability to demand accountability. Former representative Co’s accusations against the president and House of Representatives (HOR) speaker merit clarification of the formal budget process.
The budget process is designed with the distinct functions of the Executive Branch and Legislative Branch (Congress) in mind. If Pres. Marcos Jr really intervened in the bicameral conference committee (bicam) stage of budget authorization, then he really did overstep with, presumably, malice in mind.
Preparation to authorization
The budget process by law and in practice starts with the National Expenditure Program (NEP) drawn up in the first semester of every year by Pres. Marcos Jr along with his chief budget operator, budget secretary Amenah Pangandaman. This is the executive’s proposed budget for the coming year and is also called the “President’s Budget”.
However, the Constitution gives the “power of the purse” to Congress instead of the executive – which means only Congress can authorize spending (also called appropriations) and impose taxation. In line with the principle of checks and balances, the rationale is to prevent executive overreach while allowing legislative scrutiny of executive priorities.
The executive has to submit the NEP to Congress within 30 days of the opening of Congress. In Congress, the House technically conducts hearings first, passes the HOR version of the General Appropriations Bill (GAB), and then turns this over to the Senate. In practice, to save time, the Senate conducts its hearings almost simultaneously and concludes slightly later than the House to pass the Senate version of the GAB.
The bicam is then called to reconcile the differing HOR and Senate versions of the GAB, and produces the bicam report. The bicam report is then voted on separately by the HOR and by the Senate to produce the enrolled bill.
The enrolled bill is then passed to the president and when he signs this – including any vetoes – the final product is the General Appropriations Act (GAA). The term “appropriations” does not literally refer to budgets or funds available to be spent and more precisely just means authorization by Congress for the executive to spend the amount indicated.
Appropriation and misappropriation
Congress (HOR and Senate) is allowed to amend items in the NEP. This is a normal and legal part of the legislative appropriations process. “Amend” is the legal term and “insertions” is a term that emerged to better capture how legislators often have malice when they propose their amendments. That legislative authority also includes setting conditions or making special provisions.
The main restriction to the amendments that Congress can make is that they cannot increase beyond the total NEP ceiling. So, for instance, Congress can actually return an enrolled bill to the president for his signature that is smaller than the total amount of the NEP he submitted to Congress. After the Supreme Court’s landmark pork barrel decision in 2013, another important restriction is prohibiting adding items that give legislators post-enactment discretion.
The GAA or final budget is supposed to be a co-equal output of both the executive and legislative branches under a checks-and-balances system. As such, it is inappropriate to call it the budget solely of the executive or solely of the legislature.
An aside on unprogrammed appropriations (UA) is warranted especially because the Marcos Jr administration’s abuse of this budget mechanism is spectacularly unprecedented. UA are included in both the NEP and the eventual GAA as standby authorization to spend only if additional revenues or financing sources materialize – as opposed to the regular appropriations which are guaranteed to be spent.
The brazenness of the Marcos Jr administration is that it: 1) transferred hundreds of billions of pesos worth of budget items from the regular appropriations to the UA to carve out space for equivalent amounts in pork barrel insertions (not just by lawmakers but, if former Rep. Co is to be believed, by the president himself); and 2) even possibly added tens of billions of pesos in pork barrel projects in the UA. The five-fold increase in average annual UA under Pres. Marcos Jr – from Php143 billion in the decade 2013-2022 to Php690 billion in the Marcos Jr administration’s 2023-2025 budgets – is resibo for this.
Presidential super-pork
Clarity on these is relevant because they are the premises for a potentially important conclusion if, for instance, former representative Co’s exposé is factual. Pres. Marcos Jr’s intervention to amend/insert Php100 billion at the bicam stage – which is after he submitted his proposal to Congress and when he should no longer be involved – is a very serious matter. Such executive overreach violates the separation of powers and would be illegal. This is true even if he acted with the complicity of not just any legislator but of the then House Speaker, his cousin Rep. Martin Romualdez, and the then appropriations committee chair Rep. Co.
On top of the illegality itself, of course the alleged Php25 billion kickback that supposedly motivated the intervention makes the act even more reprehensible.
Clarity about the budget process also establishes the president’s accountability for hundreds of billions of pesos in pork barrel projects annually in the GAA, including and beyond the insertions alleged by former Rep. Co. Pres. Marcos Jr puts pork barrel projects in the NEP, and he signs the enrolled bill produced by Congress (which includes whatever other pork barrel projects lawmakers inserted) into law as the GAA.
Put another way, first of all, the public should be outraged at the pork barrel projects that Pres. Marcos Jr reportedly puts in the NEP during the budget preparation phase. Most of these are apparently negotiated by the president and budget secretary with lawmakers while the NEP is being crafted.
The public should also be outraged that lawmakers add more pork barrel projects to the budget while it is with them in Congress during the budget authorization phase. They do this while producing the HOR version of the GAB, while producing the senate version of the GAB, and during the bicam.
Last but not the least, the public should also be outraged that it is Pres. Marcos Jr who signs all these pork barrel projects into law as the GAA implemented in the coming year – enabling hundreds of billions of pesos of public funds to flow into the private pockets of probably hundreds of corrupt lawmakers, thousands of corrupt line agency and local government officials, and further thousands of corrupt contractors.