Fiscal autonomy of the judiciary

The importance of judicial independence cannot be denied, but neither the 1935 nor the 1973 Constitution explicitly provided for fiscal autonomy of the judiciary. President Ferdinand Marcos was aware of the importance of an independent judiciary, hence he promulgated Presidential Decree No. 1949 creating the Judicial Development Fund (JDF). The JDF was meant to bolster the independence of the judiciary through, among other means, better compensation and working conditions.

Since the JDF was created by the president and could even be terminated by the president, it stands to reason that the president could interfere with its administration. But things have to be different now. True it is that PD 1949 is still valid law. But how it operates is now limited by the Constitution through its explicit guarantee of fiscal autonomy of the judiciary.

Article VIII, Section 3 says: “The Judiciary shall enjoy fiscal autonomy. Appropriations for the Judiciary may not be reduced by the legislature below the amount appropriated for the previous year and, after approval, shall be automatically and regularly released.”

There are two sentences in the provision. The second sentence bolsters the guarantee in the first by ensuring that money will go to the judiciary regularly and automatically.

Both parts of the second sentence deal with the amount before it goes into the hands of the judiciary. Nothing is said about what the legislature or the executive may do after the money is already in the hands of the judiciary through congressional appropriation or through the JDF. The first sentence guaranteeing fiscal autonomy takes care of this.

The authorized uses of the JDF as specified in PD 1949 still hold. As to money coming through appropriation, the fiscal autonomy of the judiciary is the same as the fiscal autonomy of the constitutional commissions and the ombudsman. They are free to specify the uses of the amount within the general purpose for which it was granted. Some reporting may be required: “The Supreme Court shall, within thirty days from the opening of each regular session of the Congress, submit to the President and the Congress an annual report on the operations and activities of the Judiciary.” The purpose is to inform Congress and the executive about the financial needs of the judiciary. But as jurisprudence has said, “The Supreme Court may submit to the Department of Budget and Management reports of operation and income, current plantilla of personnel, work and financial plans and similar reports only for recording purposes.”

The matter of the use of “savings,” however, is something else. Article VI, Section 25(5) says: “No law shall be passed authorizing any transfer of appropriations; however, the President, the President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the Supreme Court, and the heads of Constitutional Commissions 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.”

Note that savings in one item may be transferred to another item, provided only that such transfer is authorized by either special or general law. In the 2012 General Appropriations Act, for instance, there is this provision: “Sec. 53. Use of Savings. The President of the Philippines, the Senate President, the Speaker of the  House of Representatives, the Chief Justice of the Supreme Court, the Heads of  Constitutional Commissions enjoying fiscal autonomy, and  the Ombudsman are hereby authorized to augment any item in this Act from savings in other items of their respective appropriations.”

It is important to understand what savings mean. “Savings refer to portions or balances of any programmed appropriation in this Act free from any obligation or encumbrance which are:  (i) still available after the completion or final discontinuance or abandonment of the work, activity or purpose for which the appropriation is authorized; (ii) from appropriations balances arising from unpaid compensation and related costs pertaining to vacant positions and leaves of absence without pay; and (iii) from appropriations balances realized from the implementation of measures resulting in improved systems and efficiencies and thus enabled agencies to meet and deliver the required or planned targets, programs and services approved in this Act at a lesser cost.”

For its part, augmentation “implies the existence in this Act of a program, activity, or project with an appropriation, which upon implementation or subsequent evaluation of needed resources, is determined to be deficient. In no case shall a nonexistent program, activity, or project, be funded by augmentation from savings or by the use of appropriations unless otherwise authorized in this Act.”

All these, I believe, were routinely inserted in the General Appropriations Act in order not to impair the operation of government offices.

In the final analysis, the meaning of all these, including the meaning of fiscal autonomy of the judiciary, will be determined by the Supreme Court and not by the executive department.