The amount withheld by Congress was moved under "unprogrammed funds". This is not a harmless window dressing because it has serious implications on the availability of the said amount. The special provisions of Section 1, LIV, on the other hand, provides:

LIV. UNPROGRAMMED FUND

 

1. Release of the Fund. The amounts herein appropriated shall be released only when the revenue collections exceed the original revenue targets submitted by the President of the Philippines to Congress pursuant to Section 22, Article VII of the Constitution or when the corresponding funding or receipts for the purpose have been realized except in the special cases covered by specific procedures in Special Provision Nos. 2, 3, 4, 5, 7, 8, 9, 13 and 14 herein: PROVIDED, That in cases of foreign-assisted projects, the existence of a perfected loan agreement shall be sufficient compliance for the issuance of a Special Allotment Release Order covering the loan proceeds: PROVIDED, FURTHER, That no amount of the Unprogrammed Fund shall be funded out of the savings generated from programmed items in this Act....

4. Additional Operational Requirements and Projects of Agencies. The appropriations for Purpose 6 - Additional Operational Requirements and Projects of Agencies herein indicated shall be released only when the original revenue targets submitted by the President of the Philippines to Congress pursuant to Section 22, Article VII of the Constitution can be realized based on a quarterly assessment of the Development Budget Committee, the Committee on Finance of the Senate and the Committee on Appropriations of the House of Representatives and shall be used to fund the following:

 

The P10 billion, which should have been given to local governments, therefore, has been conditioned upon the realization of the original revenue targets of the President. In short, this amount will not be released if revenue generation goals are not met. This allocation of funds under unprogrammed funds, therefore, makes the release of the fund conditional upon revenue collection efficiency.

As of this writing, the constitutionality of the congressional cut has never been questioned in court.

Local officials decided not to file a case after the President announced that he would release P 2.5 billion pesos representing the first quarter share of the IRA. Thereafter, the President also said that the IRA would no longer be included in the national budget to be submitted to Congress, but will now be "released automatically'".

What "released automatically" means remains unclear. In the 2001 budget submitted by the President to Congress, an allocation for the IRA amounting to P131, 917,470,000 was still included. The only difference is that it is placed under the sub-heading "Automatic Appropriations". Whether Congress will trifle with this amount remains to be seen.

 

VI. THE IMPLICATIONS OF PIMENTEL

After analyzing the Supreme Court's decision in Pimentel v. Aguirre, it becomes apparent that there are those who fail to correctly appreciate the implications of the case.

On the Acts of the Executive Branch

In reality, as important as Pimentel is, the impact of the case is very limited. In that case, the Supreme Court merely struck down Section 4 of Administrative Order No. 273 as invalid because it violated the constitutional mandate for the automatic release of the IRA, and because it violated the provisions of the Local Government Code. The Supreme Court said that the President could not withhold part of the IRA already allocated by Congress, no matter how commendable the motives for the holdback may have been.

Without a doubt, the principles adopted by the Supreme Court may be extended to all forms of control of the IRA, but it cannot be done automatically. In other words, the Executive Branch of government should be wary about issuing guidelines on the release and use of the IRA because they make likewise amount to a violation of the Constitution. Thus, even seemingly innocuous orders or directives may now be scrutinized under the standards set by the Supreme Court in Pimentel. Do these orders or directives likewise amount to a violation of the Constitution and the Local Government Code? Do they amount to a withholding of the entire or part of the IRA?

Pimentel should be used to challenge all other orders that have the effect of withholding or conditioning the release of the IRA. Here lies the value of the Supreme Court's decision. Unfortunately, under Philippine law, there is no such thing as an automatic application of a Supreme Court doctrine even to other orders that are similar to Administrative Order No. 273. In every case, a government directive may be challenged as unconstitutional, but a case has to be filed in court to resolve the validity of the directive.

To be clear, the President is not under any legal obligation to release any amount beyond the five percent that he withheld under Administrative Order No. 43. Pimentel does not compel the President to release an amount equivalent to the P10 billion, which Congress placed under "unprogrammed funds" because there is nothing in the decision that remotely implicates any act of Congress. He is not obligated to restore the "soft cut" engineered by Congress.

On the Acts of the Congress

The Supreme Court said nothing about the manner in which Congress moved 10 billion pesos of the IRA to "unprogrammed funds". This is an entirely different issue that may be phrased in this manner: whether Congress may place part of the IRA under "unprogrammed funds" without violating the Constitution.

It may be argued that Congress' decision to place a portion of the IRA under "unprogrammed funds" is also unconstitutional because it amounts to placing conditions on its release. It may be argued that placing this amount under "unprogrammed funds" transgresses the "automatic release" provisions of the law.

The fact is that there is no ruling from the Supreme Court on this issue as of now. Congress is not under any legal obligation to allocate an additional 10 billion pesos to cover the amount that was placed under "unprogrammed funds" in the national budget. To put it bluntly, Pimentel does not concern the actions of Congress.

Indeed, there is still a possibility that despite the designation of the IRA under the 2001 budget as "automatic appropriations" Congress will toy with the amount. Again, it is because the Supreme Court has not said anything on what Congress can or cannot do regarding the allocation of the IRA under the budget.

If there is a view that Congress violated the Constitution by placing conditions on the release of the IRA, then similar cases may have to be filed in court to challenge its actions.

As momentous as Pimentel is, it is simply not enough.