No more DAP, Supreme Court told

What was not discussed seemed to weigh heavier at the much delayed second Supreme Court hearing on the Disbursement Acceleration Program last Jan. 28. The DAP is a highfalutin’ label for the President’s power to realign savings throughout the executive branch.

In the first session, petitioners led by former University of the Philippines law dean Pacifico Agabin stated that, first, laws give specific definitions for “savings” and these were not met. Second, the power to realign may only be used to augment existing budget items, and the petitioners claimed funds were placed in new items. In summary, the power to realign cannot be abused such that the president single-handedly rewrites the budget or, as Justice Roberto Abad posited, allows him to impound funds.

Budget Secretary Florencio Abad emphasized that every president since Corazon Aquino imposed mandatory savings. Realignment proved crucial for President Benigno Aquino III because reviewing dubious inherited projects drastically slowed spending but the DAP moved funds to “fast-moving, high-impact” projects such as the Sitio Electrification Program, payment of insurance premiums for 93,500 teachers, and the Project Noah disaster prevention system. Abad cited World Bank statistics to argue that the DAP stimulated the economy without new debt issuances or taxes (except for sin taxes). Abad ended by announcing that the DAP was no longer needed and had not been used since mid-2013. Responding to Justice Lucas Bersamin, finally, Abad emphasized that the DAP had “absolutely no relation to the impeachment [of Chief Justice Renato Corona].”

Solicitor General Francis Jardeleza then reminded the justices that a national budget is far more complex than a household’s, an example floated in the preceding hearing. He emphasized that government spending multiplies into economic stimulus and expensive interest is paid for our debt.

Jardaleza argued that the budget process is “textually committed” to the political branches and because there are no “judicially manageable standards,” it is left to their judgment. Thus, he proposed that Congress, not the high court, must shape and police the definition of “savings.” This was inspired legal philosophy invoking the political branches’ duty to interpret the Constitution, a theory prominently used by then Justice Reynato Puno to argue that the Senate should have ruled on the validity of the impeachment complaint against then Chief Justice Hilario Davide Jr. in 2003.

Jardeleza then asserted that because the DAP has ceased to exist, any challenge to it as a program or concept is moot and that petitioners must attack the validity of any or all of 116 projects funded by it. He promised that information on all 116 would be filed at the high court by Feb. 5. These documents would prove that legal rules defining savings and augmenting existing budget items were met. Jardeleza stressed that criticisms against the DAP were “demonstrably false,” and protested descriptions such as it being a budget within a budget and a scheme to invent savings. Finally, he produced several memoranda signed by the President, refuting Senior Associate Justice Antonio Carpio’s additional argument that realignment is only valid if conducted by the President and not one of his cabinet secretaries.

Carpio pressed hardest regarding budget minutiae such as the difference between a project’s termination and its abandonment. He asked, for example, how a capital allocation can be abandoned after six months and deemed savings if the law provides a two-year period to solicit bids. Faced with specifics, Jardeleza conceded that the law might be written better, but argued that a certain flexibility is required in implementing the budget. As an example, he presented a letter from Transportation Secretary Joseph Abaya informing the President relatively early in the year that certain funds would not likely be spent and suggested these be declared savings that could be realigned. In response, Carpio asked rhetorically whether the national budget is a law that the President is sworn to faithfully execute. Jardeleza responded that if all budgets were implemented as planned, there would have been no need for the DAP. Indeed, questioning by Justices Lucas Bersamin and Marvic Leonen touched on how the budget is just an estimate, and the President must in fact choose what to fund if revenues fall below target.

The DAP’s fate will be interesting because unconstitutionality cannot be cured by wise projects and lack of corruption. On the other hand, Jardeleza masterfully reshaped the case such that he can no longer lose. With the DAP terminated, the high court might issue guidelines against it, but the projects are a fait accompli unless the high court goes to the extreme step of unwinding them, which it will not without scrutiny of Jardeleza’s 116 sets of documents. Jardeleza thus reduced the stakes to his ego, of which he is perfectly capable of letting go.

However the DAP is decided, credit must go to Abad for personally appearing alongside Jardeleza and responding to a lawsuit with the welcome whiff of delicadeza of releasing the 116 sets of documents. Further, it is admirable how the DAP case is proceeding as an intellectual exercise with no political overtones or further allegations of ghost projects. To Abad and Jardeleza’s great credit, people may well respect them even more if they lose their biggest case yet.

Oscar Franklin Tan (@oscarfbtan, facebook.com/OscarFranklinTan) won an unprecedented second Justice Irene R. Cortes Prize in constitutional law for his research on constitutional interpretation by the political branches (The 2004 Canvass, 79 Phil. L.J. 39 (2004)).