FIFTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
First Regular Session 
SENATE 
Senate Bill No. 767 
) 
) 
) 
fj;':r'::j! , C 
i ~ j 
INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
EXPLANATORY NOTE 
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The Budget Process as provided in Book VI of the Revised Administrative 
Code of 1987 (Executive Order No. 292) is the primary implementing law on the 
powers and limitations of both the executive and legislative branches in the 
preparation, 
authorization 
and 
implementation 
of the 
annual 
General 
Appropriations Act. Unfortunately, this law heavily borrows from Presidential 
Decree No. 1177 which was passed at a time when the power of the Executive 
was heavily favored at the cost of the independence and power of the Legislative 
Branch of Government. At the same time, current provisions of the Revised 
Administrative Code expand on the limitations of Congress in the Budget 
Process, providing for stricter guidelines than that contemplated under the 
Constitution. While the Constitution sees the Congress as an active, not passive, 
participant 
in 
the 
Budget process, 
the 
Revised 
Administrative 
Code 
unnecessarily puts shackles on the power of Congress in determining the 
priorities, direction and vision of government as expressed in the substance of 
the Annual Budgetary Appropriations, contrary to the very spirit and purpose of 
Congress as the bearer of the Power of the Purse as enshrined in the 1987 
Constitution. 
In general, the revised Administrative Code of 1987 limits, in a manner 
that exceed conditions set forth in the Constitution, the powers that Congress 
ought to be able to exercise in the course of budget approval. In general, the 
revised Administrative Code of 1987 and the practice of budget execution in 
recent years have been used by the Executive to exercise resource allocation 
powers beyond what the 1987 Constitution has bestowed upon it. 
This Act seeks and proposes to amend provisions of Book VI of the 
Revised Administrative Code to reflect the spirit and noble intent of the 1987 
Constitution to remove all vestiges of unmitigated Executive might and to restore 
Congress' power over the purse in the hope that through the reclamation of this 
power, Congress will be able to strengthen its ability to check the Executive. 
Specifically, this legislation intends to achieve the following reforms in the 
national budget process: 
' 
Ensure that the Executive branch of the Philippine government 
implements the budget as specified in the General Appropriations Act, making 
the execution of the budget as approved by Congress mandatory and making it 
illegal and punishable by law to do otherwise without Congressional 
authorization. Thus, the creation of reserves and the deferral or suspension of 
expenditure of appropriations 'in cases where a fiscal crisis or other contingencies 
" " 
0 


creates a situation that makes it difficult for the Executive to implement the entire 
budget as approved in the General Appropriations Act can only be carried out 
after Congress gives its approval. 
Ensure that in cases of budget re-enactment, only appropriations for 
salaries and wages for permanent positions, contractual obligations, and 
unfinished projects, programs and activities are re-enacted. Thus, the budget that 
is re-enacted should not be treated as a lump-sum that can be disbursed in its 
entirety without any restraints. 
Ensure that Congress is enabled to revise implementing rules of lump sum 
appropriations, and to suspend entirely the expenditure of lump sum 
appropriations if it finds the implementing rules to he unsatisfactory. 
Ensure that savings generated from an unexpected reduction in the costs 
of achieving project and program objectives supported by the General 
Appropriations Act are properly accounted for and reported to Congress on a 
quarterly basis. Ensure further that unspent amounts from lump sum 
appropriations will be reverted to the general fund, and disbursed only following 
fresh Congressional authorization. 
Ensure that, in addition to receiving reports about savings generated from 
completed projects, programs and activities, Congress shall also be provided 
with (1) a list of programs and projects funded by domestic and foreign loans and 
their corresponding implementing agencies, (2) a list of obligations and contracts 
of government corporations backed by government guarantees and the list of 
programs and projects funded by these obligations and contracts, (3) financial 
statements of all government corporations that require national budget support in 
the form of direct outlays, subsidies, guarantees, and tax and duty exemptions, 
and of all government corporations that remit revenues to the national 
government, and (4) a quarterly report on allotment releases. 
In view of the foregoing, the immediate enactment of this measure is 
earnestly sought. 
OY EJERCITO ESTRADA 
Senator 


FIFTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
First Regular Session 
SENATE 
Senate Bill No. 767 
) 
) 
) 
INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
AN ACT 
PRESCRIBING REFORMS IN· NATIONAL GOVERNMENT BUDGETING, 
AMENDING FOR THESE PURPOSES PERTINENT PROVISIONS OF BOOK VI 
OF EXECUTIVE ORDER 292, OTHERWISE KNOWN AS THE REVISED 
ADMINISTRATiVe CODe OF 1987, AND PROVIDING FOR OTHER RELATED 
PURPOSES 
Be it enacted by the Senate and the House of Representatives in Congress 
assembled: 
' 
SECTION 1. Title. - This shall be known as the "Budget Reform Act of 
2010." 
SEC. 2. Definition of Terms. - Section 2, Chapter 1, Book VI of EO 292 is 
hereby amended to include the following definitions: 
"SEC 2. Definition of Terms. - When used in this Book: 
xxx 
(3) "AUGMENT" IS THE POWER TO TRANSFER SAVINGS FROM ONE 
APPROPRIATION TO COVER DEFICITS IN ANOTHER AS EXERCISED 
BY THE PRESIDENT, SENATE PRESIDENT, SPEAKER OF THE 
HOUSE, CHIEF JUSTICE, AND HEADS OF THE CONSTITUTIONAL 
COMMISSIONS WITHIN 
THEIR 
RESPECTIVE 
BRANCHES AND 
AGENCIES AS PROVIDED IN THIS BOOK. 
xxx 
(8) "DEFICIT" MEANS AN INSUFFICIENCY IN THE APPROPRIATED 
AMOUNT FOR THE COMPLETION OF A PARTICULAR PROGRAM, 
PROJECT OR ACTIVITY OR THE FULFILLMENT OF CURRENT 
OPERATING EXPENDITURES AND CAPITAL OUTLAYS NOT ARISING 
FROM CAUSES SUCH AS OVERPRICING OR OTHER FACTORS 
WHICH COULD HAVE.BEEN REASONABLY FORESEEN IN ORDER TO 
COMPLETE THE PROGRAM WITHIN THE GIVEN APPROPRIATION 
SPECIFIED IN THE GENEML APPROPRIATIONS ACT FOR SAID 
PROGRAM, 
PROJECT 
OR 
ACTIVITY, 
CURRENT 
OPERATING 
EXPENDITURES AND CAPITAL OUTLAYS. 
xxx 


(16) "SAVINGS" MEANS ANY UNEXPENDED PORTION OR AMOUNT 
OF MONEY FOR AN APPROPRIATION AS SPECIFIED IN THE 
GENERAL 
APPROPRIATIONS 
ACT 
RESULTING 
FROM 
THE 
COMPLETION OF A PROGRAM, PROJECT OR ACTIVITY OR 
FULFILLMENT OF THE PURPOSE FOR WHICH THE APPROPRIATION 
WAS SPECIFIED AT A COST BELOW THE AMOUNT APPROPRIATED 
DUE TO LOWER-THAN EXPECTED EXPENDITURES. THIS SHALL 
NOT REFER TO UNEXPENDED AMOUNTS RESULTING FROM THE 
SUSPENSION 
OF 
EXPENDITURE 
OF 
APPROPRIATIONS. 
IN 
ADDITION, 
THIS 
SHALL 
NOT 
REFER 
TO 
UNEXPENDED 
APPROPRIATIONS IN A 'RE-ENACTED BUDGET FOR COMPLETED 
OR SUSPENDED PROJECTS OR PROGRAMS. 
(17) "SPECIAL APPROPRIATION" IS A LAW OTHER THAN THE 
GENERAL APPROPRIATIONS ACT APPROPRIATING FUNDS FOR A 
PARTICULAR PROGRAM, PROJECT, OR ACTIVITY." 
(18) "RE·ENACTED BUDGET" REFERS TO THE PREVIOUS YEAR'S 
BUDGET THAT TAKES EFFECT IN CASE CONGRESS FAILS TO PASS 
A NEW GENERAL APROPRIATIONS ACT FOR THE CURRENT YEAR. 
SEC. 3. Section 12, Chapter 3, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 12. Form and Content of the Budget. - The budget proposal of 
the President shall include current operating expenditures and capital 
outlays. It shall comprise such funds as may be necessary for the 
operation of the programs, projects and activities of the various 
departments and agencies. [The proposed General Appropriations Act 
and other Appropriations Acts necessary to cover the budget proposals 
shall be submitted to the Congress to accompany the President's budget 
submission.] ALL APPROPRIATIONS AND 
EXPENDITURES FOR A 
PARTICULAR 
DEPARTMENT, 
OFFICE, 
AGENCY 
AND/OR 
GOVERNMENT-OWNED OR CONTROLLED CORPORATIONS SHALL 
BE INCLUDED AND LISTED EXCLUSIVELY IN THE BUDGET FOR 
SUCH DEPARTMENT, OFFICE, AGENCY AND/OR GOVERNMENT-
OWNED OR CONTROLLED CORPORATIONS HAVING CONTROL 
OVER SUCH FUNDS. ALL EXPENDITURES OF THE VARIOUS 
DEPARTMENTS, OFFICES, AGENCIES AND/OR 
GOVERNMENT-
OWNED OR CONTROLLED CORPORATION SHOULD BE UNIFORMLY 
CLASSIFIED BY COMMON ACCOUNT TITLES. THE PRESENTATION 
OF ALL PROJECTED REVENUE AND PROPOSED EXPENDITURE 
ITEMS MUST SHOW THE CURRENT YEARS CORRESPONDING 
REVENUE AND EXPENDITURE TOGETHER WITH THE PREVIOUS 
TWO 
YEARS' 
CORRESPONDING 
ACTUAL 
REVENUE 
AND 
EXPENDITURE. 
The budget shall be presented to the Congress in such form and content 
as [may be approved by the President] PRESCRIBED IN THIS SECTION and 
[may] SHALL include the following: 
(1) A budget message .setting forth in brief the government's budgetary 
thrusts for the budget year, including their impact on development goals, 
monetary and fiscal objectives, and generally on the implications of the revenue, 
expenditure and debt-proposals; and 


(2) Summary financial statements setting forth 
(a) Estimated expenditures and proposed appropriations necessary for the 
support of the Government for the ensuing fiscal year, including those financed 
from operating revenues and from domestic and foreign borrowings, TOGETHER 
WITH A BREAKDOWN AND JUSTIFICATION OF ALL ITEMS IN EXCESS OF 
ONE HUNDRED MILLION PESOS AS WELL AS A LISTING OF CAPITAL 
OUTLAYS SUPPORTED BY JUSTIFICATION AND COST BENEFIT ANALYSIS; 
(b) Estimated receipts during the ensuing fiscal year under laws existing at 
the time the budget is transmitted and under the revenue proposals, if any, 
forming 
part of the year's financing 
program, TOGETHER WITH 
A 
BREAKDOWN OF RECEIPT ITEMS AND LISTING OF ASSUMPTIONS; 
(c) Actual appropriations, expenditures, and receipts during the last 
completed fiscal year, TOGETHER WITH A DETAILED EXPLANATION OF THE 
VARIANCES, IF ANY, BETWEEN THE ESTIMATED AND ACTUAL RECEIPTS, 
AND BETWEEN THE PROPOSED AND ACTUAL EXPENDITURES; 
(d) [Estimated] ACTUAL APPROPRIATIONS, expenditures and receipts 
[and actual or proposed appropriations] during the fiscal year in progress, 
TOGETHER WITH A DETAILED EXPLANATION OF THE VARIANCES, IF ANY, 
BETWEEN THE ESTIMATED AND ACTUAL RECEIPTS, AND BETWEEN THE 
PROPOSED AND ACTUAL EXPENDITURES; 
(e) [Statements of] The condition of the National Treasury at the end of the 
last completed fiscal year, the estimated condition of the Treasury at the end of 
the fiscal year in progress and the estimated condition of the Treasury at the end 
of the ensuing fiscal year, taking into account the adoption of financial proposals 
contained in the budget and showing, at the same time, the unencumbered and 
unobligated cash resources; 
. 
(f) Essential facts regarding the bonded and other long-term obligations 
and indebtedness of the Government, both domestic and foreign, including 
identification 
of recipients 
of loan 
proceeds, 
TOGETHER 
WITH 
AN 
EXPLANATION OF HOW THE LOAN PROCEEDS WERE USED AND A 
LISTING OF PROJECTS, PROGRAMS AND OFFICES BENEFITED FROM 
SUCH LOANS; 
(g) [Such other financial statements and data as are deemed necessary or 
desirable in order to make known in reasonable detail the financial condition of 
the government.] ESSENTIAL FACTS REGARDING OBLIGATIONS AND 
CONTRACTS, REGARDLESS OF FUNDING SOURCE, OF GOVERNMENT 
AGENCIES, CORPORATIONS OR OTHER ENTITIES THAT ARE BACKED BY 
GOVERNMENT GUARANTEES, TOGETHER WITH AN EXPLANATION OF 
THE RATIONALE FOR INCURRING THE OBLIGATIONS AND CONTRACTS, 
AND A LISTING OF PROJECTS, PROGRAMS, AND OFFICES THAT 
BENEFITED FROM THESE OBLIGATIONS AND CONTRACTS; 
(h) THE FINANCIAL POSITION FOR THE LAST COMPLETED FISCAL 
YEAR, AND THE FISCAL YEAR IN PROGRESS, AND THE PROPOSED 
OPERATING BUDGETS FOR THE ENSUING FISCAL YEAR, OF ALL 
GOVERNMENT 
CORPORATIONS 
REMITTING 
REVENUES 
TO 
THE 
NATIONAL GOVERNMENT OR REQUIRING NATIONAL BUDGET SUPPORT 
EITHER IN THE FORM OF DIRECT OUTLAYS, SUBSIDIES, GUARANTEES, 
AND TAX AND DUTY EXEMPTIONS; AND (i) SUCH OTHER FINANCIAL 
STATEMENTS AND DATA AS ARE DEEMED NECESSARY OR DESIRABLE IN 


ORDER TO MAKE KNOWN IN REASONABLE DETAIL THE FINANCIAL 
CONDITION OF THE GOVERNMENT." 
SEC. 4. Section 21, Chapter 3, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 21. Appropriation for Personal Services. - Appropriations for 
personal services shall be [considered as] included in the amount 
specified for each budgetary program and project of each department, 
bureau, office or agency, and shall [not] be itemized by plantilla position. 
The itemization of personal services shall be prepared by the Secretary 
[for consideration and approval of the President] as provided in Section 23 
hereof. [Provided, that] Itemization of personal services shall be prepared 
for all agencies of the Legislative, Executive and Judicial Branches and 
the Constitutional bodies, except as may be otherwise approved by the 
President for positions concerned with national security matters." 
SEC. 5. Section 23, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 23. Content of the General Appropriations Act. - The General 
Appropriations Act shall be presented in the form of budgetary programs 
and projects for each agency of the government, with the corresponding 
appropriations for each program and project, including statutory provisions 
of specific agency or general applicability. The General Appropriations Act 
shall [not contain any] INCLUDE AN itemization of all personal services by 
plantilla position, which shall be prepared by the Secretary [after 
enactment of the General Appropriations Act, for consideration and 
approval of the PreSident] AS PART OF THE PROPOSED BUDGET 
SUBMITTED TO CONGRESS BY THE PRESIDENT." 
SEC. 6. Section 24, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 24. Prohibition against the Increase of Appropriation FOR THE 
OPERA T/ON OF THE GOVERNMENT - The Congress shall in no case 
increase the appropriation [of any project or program of any department, 
bureau, agency or office] of the Government over the total amount 
submitted by the President in his budget proposal. HOWEVER, IT MAY 
INCREASE 
APPROPRIATION 
FOR 
THE 
OPERATION 
OF 
A 
DEPARTMENT, AGENCY, OR OFFICE WITH THE CORRESPONDING 
ADJUSTMENT IN THE APPROPRIATIONS OF ANOTHER SO AS NOT 
TO EXCEED THE TOTAL APPROPRIATIONS SUBMITTED BY THE 
PRESIDENT IN HIS BUDGET PROPOSAL FOR THE OPERATION OF 
THE ENTIRE GOVERNMENT. [In case of any reduction in the proposed 
appropriation for a project or program, a corresponding reduction shall be 
made in the total appropriation of the department, office or agency 
concerned and in the total of the General Appropriations BilL]" 
SEC. 7. Section 25, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 
25. 
[Prohibition Against] Enactment of Additional Special 
Provisions. - The Congress [shall not] MAY add special provisions in the 
budget earmarking the use of appropriations for specific programs or 
activities [nor shall it increase the amounts specified in special provisions 
beyond those proposed by the PreSident] PROVIDED THIS DOES NOT 


RESULT 
IN 
THE 
INCREASE 
OF 
THE 
APPROPRIATIONS 
RECOMMENDED BY THE PRESIDENT FOR THE OPERATION OF THE 
GOVERNMENT." 
SEC. 8. Section 26, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 26. Automatic Appropriations. - All expenditures for (1) personnel 
retirement premiums, government service insurance, and other similar 
fixed expenditures, (2) principal and interest on public debt, (3) national 
government guarantees of obligations which are drawn upon, are 
automatically appropriated; provided, that no obligations shall be incurred 
or payments made from flmds thus automatically appropriated except as 
issued in the form of regular budgetary allotments, PROVIDED FURTHER 
THAT OBLIGATIONS OF GOVERNMENT CORPORATIONS INCURRED 
HEREON WILL NO LONGER BE AUTOMATICALLY GUARANTEED BY 
THE NATIONAL GOVERNMENT, UNLESS OTHERWISE EXPLICITLY 
AUTOMATICALLY GUARANTEED BY LAW." 
SEC. 9. Section 27, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 27. LSupplemental Appropriations] SPECIAL APPROPRIA TJONS. -
All appropriation proposals shall be included and considered in the budget 
preparation process. After the President shall have submitted the budget, 
[no supplemental appropriation measure supported from existing revenue 
measures shall be passed by the Congress.] SPECIAL APPROPRIATION 
MEASURES MAY BE PASSED BY CONGRESS PROVIDED THESE 
ARE SUPPORTED BY FUNDS TO BE RAISED BY A CORRESPONDING 
REVENUE 
PROPOSAL 
THEREIN 
OR 
BY 
FUNDS 
ACTUALLY 
AVAILABLE AS CERTIFIED BY THE NATIONAL TREASURER, WHICH 
MAY INCLUDE THE UNI;XPENDED BALANCES OF APPROPRIATIONS 
AUTHORIZED FOR THE ONGOING FISCAL YEAR THAT ARE 
REVERTED TO THE UNAPPROPRIATED SURPLUS OF THE GENEML 
FUND. [However, supplemental or deficiency appropriations involving the 
creation of new offices, programs or activities may be enacted if 
accompanied and supported by new revenue sources.]" 
SEC. 10. Section 28, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. 28. Reversion of Unexpended Balances of Appropriations, 
Continuing Appropriations. - Unexpended balances of appropriations 
authorized in the General Appropriations Act shall revert to the 
unappropriated surplus of the General Fund at the end of the fiscal year 
and shall not thereafter be available for expenditure except by subsequent 
legislative enactment: Provided, that appropriations for capital outlays 
shall remain valid until fully spent or reverted: provided, further, that 
continuing appropriations for current operating expenditures may be 
specifically recommended and approved as such in support of projects 
whose 
effective 
imp)ementation 
calls 
for 
multi-year 
expenditure 
commitments. [Provided, finally, that the President may authorize the use 
of savings realized by an agency during given year to meet non-recurring 
expenditures in a subsequent yeaL] 


APPROPRIATIONS FOR CAPITAL OUTLAY SHALL IN NO CASE 
BE REALIGNED FOR PERSONAL SERVICES AND MAINTENANCE 
AND OTHER OPERATING EXPENDITURES. The balances of continuing 
appropriations shall be reviewed as part of the annual budget preparation 
process and the President may approve upon recommendation of the 
Secretary, the reversion of funds no longer needed in connection with the 
activities funded by said continuing appropriations." 
SEC. 11. A new Section 29 is hereby introduced in Chapter 4, Book VI of 
EO 292 to read as follows: 
"SEC. 29. RE-ENACTED APPROPRIATIONS. - IF, BY THE END OF 
ANY FISCAL YEAR, CONGRESS SHALL HAVE FAILED TO PASS THE 
GENERAL APPROPRIATIONS BILL FOR THE ENSUING FISCAL YEAR, 
THE GENERAL APPROPRIATIONS LAW FOR THE ENDING FISCAL 
YEAR 
SHALL BE DEEMED RE-ENACTED AND SHALL REMAIN IN 
FORCE AND EFFECT UNTIL THE GENERAL APPROPRIATIONS BILL 
IS PASSED BY CONGRESS. PROVIDED, THAT ONLY TIHE ANNUAL 
APPROPRIATIONS FOR SALARIES AND WAGES OF EXISTING 
POSITIONS, 
STATUTORY 
AND 
CONTRACTUAL 
OBLIGATIONS, 
UNEXPENDED ITEMS FOR UNFINISHED PROJECTS, PROGRAMS 
AND ACTIVITIES, LUMP SUMS, AND ESSENTIAL OPERATING 
EXPENSES SHALL BE DEEMED REENACTED AND DISBURSEMENT 
OF FUNDS SHALL BE IN ACCORDANCE THEREWITH. A RE-
ENACTED BUDGET, THEREFORE IS NOT A LUMP-SUM AMOUNT OF 
THE 
ENTIRE 
BUDGET 
OF 
THE 
PREVIOUS 
YEAR 
WHOSE 
EXPENDITURE AND ALLOCATION IS THE PROVINCE OF THE 
EXECUTIVE. 
PROVIDED FURTHER, THAT UNDER A SITUATION OF A 
REENACTED BUDGET, NO BILL AUTHORIZING SUPPLEMENTAL 
APPROPRIATIONS SHALL BE PASSED BEFORE THE ANNUAL 
APPROPRIATIONS BILL IS PASSED. 
PROVIDED FINALLY, THAT THE PRESIDENT SHALL SUBMIT A 
REPORT TO CONGRESS OF EXPENDITURES INCURRED AND 
RECEIPTS EARNED DURING THE PERIOD IN WHICH ARE-ENACTED 
BUDGET WAS IN EFFECT. THIS REPORT SHALL BE SUBMITTED 
WITHIN THIRTY (30) DAYS AFTER PASSAGE OF THE GENERAL 
APPROPRIATIONS ACT FOR THE FISCAL YEAR." 
SEC. 12. Sections 29, 30 and 31 of Chapter 4, Book VI of EO 292 are 
hereby renumbered as follows: 
SEC. [29] 30. Loan Proceeds. - XXX 
SEC.[30] 31. Contingent Liabilites- .X X X 
SEC. [31] 32. Liability for Unauthorized Printing Press Revisions. - XXX 
SEC. 13. Section 32, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. [32] 33. Use of Appropriated Funds. - All moneys appropriated for 
functions, activities, projects and programs shall be available solely for the 
specific purposes for which these are appropriated UNLESS THESE ARE 


SAVINGS IN APPROPRIATIONS USED TO COVER DEFICITS OR 
UNEXPENDED BALANCES OF APPROPRIATIONS REVERTED TO 
THE UNAPPROPRIATED 'SURPLUS OF THE GENERAL FUND AND 
LEGISLATED TO BE USED FOR OTHER PURPOSES." 
SEC. 14. Section 33, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. [33] 34. Allotment of Appropriations. - Authorized appropriations 
shall be allotted in accordance with the procedure outlined hereunder: 
xxx 
(6) PURSUANT TO SECTION 39 OF THIS BOOK, the Secretary shall 
have NO authority to modif.y or amend any allotment previously issued. In 
case he shall find at any· time that the probable receipts from taxes or 
other sources of any fund will be less than anticipated and that as a 
consequence the amount available for the remainder of the term of the 
appropriations or for any allotment period will be less than the amount 
[estimated or allotted thereof] APPROPRIATED OR ALLOTTED, he shall 
[with the approval of the President and after notice to the department or 
agency concerned, redu'ce the amount or amounts allotted so as] 
RECOMMEND TO THE PRESIDENT THE REDUCTION OF THE 
AMOUNT OR AMOUNTS ALLOTTED THAT HE DEEMS NECESSARY to 
conform to the targeted budgetary goals. THE PRESIDENT, IN TURN, 
SHALL SEEK THE AUTHORIZATION OF CONGRESS TO SUSPEND 
THE EXPENDITURE OF APPROPRIATIONS." 
(7) The Secretary shall maintain a control record showing quarterly by 
funds, 
accounts, and 
other suitable classifications, the amounts 
appropriated; THE ALLOTMENTS RELEASED AND AVAILABLE FOR 
EXPENDITURE, the AMOUNT OF SAVINGS IN APPROPRIATIONS 
GENERATED AND THE AMOUNT USED TO COVER DEFICITS AND 
THE AMOUNT REVERTED 0 TO THE GENERAL FUND, the estimated 
[revenues] AND the actual revenues or receipts, [the amounts allotted and 
available for expenditures] the unliquidated obligations, actual balances on 
hand, and the unencumbered balance of the allotments for each 
department or agency of the Government. 
THE SECRETARY SHALL SUBMIT THESE RECORDS TO THE HOUSE 
COMMITTEE ON APPROPRIATIONS AND THE SENATE COMMITTEE. 
THE ON FINANCE QUARTERLY, AND SHALL MAKE THESE RECORDS 
AVAILABLE TO THE PUBLIC EXCEPT AS MAY BE OTHERWISE 
APPROVED BY THE PRESIDENT FOR FUNDS AND ACCOUNTS 
CONCERNED WITH NATIONAL SECURITY MATTERS." 
SEC. 15. Section 35, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. [35] 36. Special Budgets for Lump-Sum Appropriations. -
Expenditures from lump-sum appropriations authorized for any purpose or 
for any department, office or agency in any annual General Appropriations 
Act or other Act and from any fund of the National Government, shall be 
made in accordance with a special budget to be approved by the 
President, which shall include but shall not be limited to the number of 
each kind of position, the designations, and the annual salary proposed for 


which an appropriation is intended. This provision shall be applicable to all 
revolving funds, receipts which are automatically made available for 
expenditure for certain specific purposes, aids and donations for carrying 
out certain activities, or deposits made to cover the cost of special 
services to be rendered t6 private parties. Unless otherwise expressly 
provided by law, when any Board, head of department, chief of bureau or 
office, or any other official, is authorized to appropriate, allot, distribute or 
spend any lump-sum appropriation or special, bond, trust, and other 
funds, such authority shall be subject to the provisions of this section. 
In case of any lump-sum appropriation for salaries and wages of 
temporary and emergency laborers and employees, including contractual 
personnel, provided in any General Appropriation Act or other Acts, the 
expenditure of such appropriation shall be limited to the employment of 
persons paid by the month, by the day, or by the hour. 
THE BUDGET AND THE GENERAL APPROPRIATIONS ACT 
MAY ALSO PROVIDE LUMPS SUMS IN ORDER TO SUPPORT BILLS 
FOR LATER ACTION BY THE CONGRESS; PROVIDED, THAT THE 
TREASURY CERTIFICATION REQUIREMENT SHALL BE DEEMED 
COMPLIED WITH IN CASE OF BILLS WHICH ARE FUNDED FROM 
LUMP SUMS IN THE GENERAL APPROPRIATIONS ACT APPROVED 
BY THE CONGRESS FOR PURPOSES OF SUPPORTING PROGRAMS, 
PROJECTS, 
OR 
ACTIVITIES 
WHICH 
REQUIRE 
SPECIFIC 
LEGISLATIVE AUTHORIZATION AND IN THE CASE OF BILLS WHOSE 
EXPENDITURES ESTIMATES ARE INCLUDED IN THE BUDGET 
SUBMISSION OF THE PRESIDENT PURSUANT TO SECTION 12 OF 
THIS BOOK. 
WITHIN THIRTY (30) DAYS AFTER THE PASSAGE OF THE 
GENERAL APPROPRIATIONS ACT FOR THE FISCAL YEAR, THE 
SECRETARY OF BUDGET AND MANAGEMENT SHALL PROVIDE THE 
CONGRESS 
WITH 
THE 
IMPLEMENTING 
RULES 
FOR 
THE 
DISBURSEMENT OF ALL LUMP-SUM APPROPRIATIONS AS WELL AS 
A LIST OF ALL EXPENDITURES TO BE UNDERTAKEN USING THESE 
LUMP-SUM APPROPRIATIONS, PROVIDED, THAT THE CONGRESS, 
BY WAY OF A JOINT RESOLUTION, MAY SUSPEND FROM 
EXPENDITURE ANY OR ALL LUMP-SUM APPROPRIATIONS. 
UNEXPENDED AMOUNTS OF LUMP SUM APPROPRIATIONS 
UNDER THIS SECTION SHALL UNDER NO CIRCUMSTANCES BE 
CONSIDERED AND USED AS SAVINGS BUT SHALL AUTOMATICALLY 
REVERT BACK TO ~HE UNAPPROPRIATED SURPLUS OF THE 
GENERAL FUND AT THE END OF THE FISCAL YEAR PURSUANT TO 
SECTION 28 OF THIS BOOK. ANY ACT TO THE CONTRARY SHALL 
BE CONSIDERED MISUSE OF GOVERNMENT FUNDS AND ILLEGAL 
EXPENDITURES AS PROVIDED IN SECTIONS 80 AND 44 OF THIS 
BOOK." 
SEC. 16. Section 37, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. [37] 38. Creation of Appropriation Reserves. - [The Secretary 
may] THE PRESIDENT, SUBJECT TO THE REVIEW AND APPROVAL 
OF CONGRESS, MAY BE AUTHORIZED TO establish reserves against 
appropriations, 
EXCEPT 
FOR 
PERSONAL 
SERVICES 


APPROPRIATIONS 
USED 
FOR 
PERMANENT 
OFFICIALS 
AND 
EMPLOYEES, to provide for contingencies and emergencies which may 
arise later in the calendar year [and which would otherwise require 
deficiency 
appropriations]. 
CONGRESS 
SHALL 
TRANSMIT 
ITS 
APPROVAL OR DENIAL TO THE PRESIDENT THIRTY (30) DAYS 
AFTER ITS RECEIPT OF THE PRESIDENT'S REQUEST FOR 
AUTHORITY. 
INACTION ON THE PART OF CONGRESS WITHIN SAID THIRTY 
(30) DAY PERIOD SHALL MEAN AN APPROVAL OF THE REQUEST 
FOR AUTHORITY TO DEFER EXPENDITURE OF APPROPRIATIONS 
AND 
THE 
CREATION 
OF 
RESERVES. 
RESERVATION 
OF 
APPROPRIATIONS MUST NOT EXTEND BEYOND THE END OF THE 
FISCAL YEAR 
[The establishment of appropriation reserves shall not necessarily 
mean that such portion of,the appropriation will not be made available for 
expenditure. Should conditions change during the fiscal year justifying the 
use of the reserve, necessary adjustments may be made by the Secretary 
when requested by the department, official or agency concerned.]" 
SEC. 17. Section 38, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
"SEC. [38] 39. Suspension of Expenditure of Appropriations. - THE 
IMPLEMENTATION OF THE GENERAL APPROPRIATIONS ACT IS 
MANDATORY, AND FAILURE TO RELEASE ALLOTMENTS FOR 
APPROPRIATED ITEMS AS PROVIDED FOR IN SAID ACT SHALL 
CONSTITUTE MISUSE' OF GOVERNMENT FUNDS AND ILLEGAL 
EXPENDITURES AS PROVIDED IN SECTIONS 80 AND 44 OF THIS 
BOOK. 
FUND RELEASES FOR APPROPRIATIONS AUTHORIZED IN 
THE GENERAL APPROPRIATIONS ACT SHALL BE TRANSMITTED IN 
ACCORDANCE WITH THE QUARTERLY ALLOTMENT PERIOD OR 
ANY OTHER PERIOD PRESCRIBED BY THE SECRETARY OF 
BUDGET AND MANAGEMENT. THE COMMISSION ON AUDIT SHALL 
ENSURE COMPLIANCE WITH THIS PROVISION TO THE EXTENT 
THAT SUBALLOTMENTS BY DEPARTMENTS AND/OR CENTRAL 
AGENCIES TO THEIR SUBORDINATE OFFICES ARE IN CONFORMITY 
WITH ALLOCATIONS IN BUDGETARY ADVICE OF ALLOTMENTS OR 
TREASURY WARRANTS ISSUED BY THE DEPARTMENT OF BUDGET 
AND MANAGEMENT. 
HOWEVER, except as otherwise provided in the General 
Appropriations Act [and whenever in his judgment the public interest so 
requires], the President [upon notice to the head of office concemed, is 
authorized], 
SUBJECT TO THE REVIEW AND 
APPROVAL OF 
CONGRESS, MAY BE. AUTHORIZED to suspend or otherwise stop 
further expenditure of. funds allotted for any agency, or any other 
expenditure authorized in the General Appropriations Act, except for 
personal services appropriations used for permanent officials and 
employees. CONGRESS SHALL TRANSMIT ITS APPROVAL OR 
DENIAL TO THE PRESIDENT THIRTY (30) DAYS AFTER ITS RECEIPT 
OF THE PRESIDENT'S REQUEST FOR AUTHORITY. INACTION ON 
THE PART OF CONGRESS WITHIN SAID THIRTY (30) DAY PERIOD 
SHALL MEAN A DENIAL OF THE REQUEST FOR AUTHORITY TO 


SUSPEND 
EXPENDITURE 
OF 
APPROPRIATIONS. 
ALL 
FUNDS 
CORRESPONDING TO THE RESCINDED APPROPRIATIONS SHALL 
REVERT TO THE UNAPPROPRIATED SURPLUS OF THE GENERAL 
FUND AND SHALL NOT BE MADE AVAILABLE FOR EXPENDITURE 
FOR ANY PURPOSE EXCEPT AS MAY BE PROVIDED FOR IN 
SUBSEQUENT SPECIAL APPROPRIATION LAWS ENACTED BY 
CONGRESS. 
ANY PROVISION OF LAW TO THE CONTRARY NOTWITHSTANDING, 
THE 
APPROPRIATIONS 
AUTHORIZED 
FOR 
THE 
JUDICIARY, 
CONGRESS, THE COMMISSION ON HUMAN RIGHTS, THE OFFICE 
OF THE OMBUDSMAN, THE CIVIL SERVICE COMMISSION, THE 
COMMISSION ON AUDIT AND THE COMMISSION ON ELECTIONS IN 
THE ANNUAL APPROPRIATIONS ACT SHALL BE AUTOMATICALLY 
AND REGULARLY RELEASED IN ACCORDANCE WITH THEIR 
RESPECTIVE WORK AND FINANCIAL PLANS." 
SEC. 18. Section 39, Chapter 4, Book VI of EO 292, is hereby amended to 
read as follows: 
. 
"SEC. [39] 40. Authority to Use Savings in Appropriations to Cover 
Deficits. • Except as otherwise provided in the General Appropriations 
Act, any savings in the regular appropriations authorized in the General 
Appropriations Act for programs and projects of any department, office or 
agency [may] SHALL BE REVERTED TO THE UNAPPROPRIATED 
SURPLUS OF THE GENERAL FUND OR, with the approval of the 
President, MAY be used to cover a deficit in any other item of the regular 
appropriations: provided, that the creation of new positions or increase of 
salaries shall not be allowed to be funded from budgetary savings except 
when specifically authorized by law: provided, further, that whenever 
authorized positions are transferred from one program or project to 
another within the same department, office or agency, the corresponding 
amounts appropriated for personal services are also deemed transferred, 
without, however increasing the total outlay for personal services of the 
department, office or agency concerned. 
UNDER NO CIRCUMSTANCES SHALL SAVINGS BE USED FOR 
PROGRAMS, 
PROJECTS 
AND 
ACTIVITIES, 
OR 
ANY 
OTHER 
PURPOSE 
NOT 
APPROPRIATED 
FOR 
IN 
THE 
GENERAL 
APPROPRIATIONS ACT PURSUANT TO ARTICLE VI, SECTION 29 (1) 
OF THE 1987 CONSTITUTION. ANY ACT TO THE CONTRARY SHALL 
CONSTITUTE MISUSE OF GOVERNMENT FUNDS AND ILLEGAL 
EXPENDITURES AS PROVIDED IN SECTIONS 80 AND 44 OF THIS 
BOOK. IN ADDITION, ANY USE OF SAVINGS ON EXPENDITURES 
SUBJECT 
TO 
LIMITATIONS 
PROVIDED 
IN 
THE 
GENERAL 
APPROPRIATIONS ACT SHALL BE REVIEWED AND MAY BE 
DISALLOWED BY CONGRESS FOR BEING MADE IN VIOLATION OF 
SAID LIMITATIONS." 
SEC. 19. Section 49 of Chapter 5, Book VI of EO 292 is hereby deleted. 
SEC. 20. Sections 34, 36, 40, 41, 42, 43, 44, 45, 46, 47, and 48 of 
Chapter, 5 Book VI of EO 292' are hereby renumbered as follows: 
SEC. [34] 35. Program of Expenditure. - XXX 
, 
SEC. [36]37. Cash Budgets. - XXX 


'. 
SEC. [40]41. Certification of Availability of Funds. - XXX 
SEC. [41]42. Prohibition Against the Incurrence of Overdraft. - XXX 
SEC. [42]43. Adjustment of Appropriations for Reorganization. - XXX 
SEC. [43]44. Liability for /IIegal Expenditures. - XXX 
SEC. [44]45. Accrual of Income to Unappropriated Surplus of the General 
Fund. -XXX 
SEC. [45]46. Special, Fiduciary and Trust Funds. - XXX 
SEC. [46]47. Service Fees and Honoraria. - XXX 
SEC. [47]48. Administration of Lump Sum Funds. -XXX 
SEC. [48]49. Cost Reduction. - XXX 
SEC. 21. Separabiliy Clause. - If any part, section or provision of this Act 
is held invalid or unconstitutional, other provisions not affected thereby shall 
remain in full force and effect. 
SEC. 22. Repealing Clause. - Presidential Decree No. 1177 is hereby 
expressly repealed. The pertinent provisions of Book VI of Executive Order No. 
292 or the Revised Administrative Code of 1987 are hereby repealed or 
amended accordingly. All laws, decrees, orders, rules and regulations or other 
issuances inconsistent with the provisions of this Act are hereby repealed, 
amended or modified accordingly. 
SEC. 23. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in at least two (2) newspapers of general circulation. 
Approved,