Unprogrammed funds: From 8 in NEP to 51 in GAA

From eight items worth a total of P281.9 billion in unprogrammed appropriations in the National Expenditure Program for 2024 or the budget proposed by the executive branch, there were 43 more items worth P449.5 billion in unprogrammed funds in the General Appropriations Act that Congress passed and President Ferdinand "Bongbong" Marcos signed.

These brought the unprogrammed appropriations to 51 worth a total of P731.4 billion in the GAA for 2024, an increase of 160%.

As per the definition of the Department of Budget and Management, unprogrammed appropriations are new allocations that will only be made available when there are excess revenues, new revenue sources, or approved new loans for foreign-assisted projects.

Senator Aquilino "Koko" Pimentel III and Albay Representative Edcel Lagman have adverted to Article VI, Section 25 of the Constitution which provides, "The Congress may not increase the appropriations recommended by the President for the operation of the Government as specified in the budget."

The lawmakers have questioned the constitutionality of the increase in the unprogrammed allocations in the GAA for 2024 from those recommended by the executive branch in NEP.

The DBM, however, said that unprogrammed appropriations were "standby appropriations, outside the approved government fiscal program, which serve as an important tool for the government to address unforeseen expenditures and prioritize essential programs and projects.”

The following are the unprogrammed appropriations proposed by the executive branch in the NEP and those that made it to the budget law for 2024: 

Sen. Juan Edgardo Angara, the chairman of the Senate Committee on Finance, defended the final version of the budget bill, saying that the constitutional provision only refers to the programmed appropriations or the funds that are specified to fund certain projects.

The DBM, likewise, said that "pursuant to the constitutional provision under Section 29 (1), Article VI, it is prescribed that, ‘No money shall be paid out of the Treasury except in pursuance of an appropriation made by law’.”

“It is therefore clear that the deliberation and approval of the limits of any appropriations is within the purview of the legislature,” the Budget Department said.

Albay Rep. Joey Salceda, the chairman of the House Committee on Ways and Means, said the question of whether or not unprogrammed funds were covered by the constitutional prohibition on increasing appropriations recommended by the President had been discussed in Congress.

Salceda said the DBM wrote his office to clarify that unprogrammed appropriations were not part of the fiscal program.

"As such, only the programmed appropriations are subject to the Article VI, Section 25 (1) of the Constitution, or the prohibition against increasing appropriations recommended by the President," Salceda said.

"In short, the DBM said Congress can increase the unprogrammed appropriations as proposed," the Albay representative said.

The DBM said that unprogrammed appropriations of the 2024 budget are not automatically allocated and can only be released if several funding conditions are met, such as when the government, through the Bureau of Treasury, can collect excess revenue in the total tax revenues or any of the identified non-tax revenue sources from its revenue target, or new revenue from new tax or non-tax sources, or should foreign or approved financial loans/grants proceeds are realized.

“Should there be new or excess revenues that may trigger the availability of the unprogrammed funds, government agencies are required to submit the necessary documentary requirements before access to the standby funds is given,” the DBM said, adding that “such conditions ensure that spending stays within allowable limits.”

“Rest assured that regardless of any petition or challenge, the DBM shall work within our approved fiscal program,” it added. —NB, GMA Integrated News