HFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regullir Session 
) 
) 
I 
SENATE 
S. B. No._?J:19 
Introduced by Senator FRANCIS G. ESCUDERO 
EXPLANATORY NOTE 
This bill is an offshoot of the highly controversial, if not anomalous, 
National Broadband Network (NBN) project of the government. 
In the course of the ongoing investigation being conducted by this 
chamber, it has been determined that the NBN project is to be funded through 
foreign borrowing or loan. Such being the case, legal issues have been raised as 
to whether or not the government complied with the requisites provided for by 
pertinent laws. 
One for instance is that if the NBN project is an Official Development 
Assistance (ODA) program, congressional approval is required as mandated by 
Section 4 of Republic Act No. 4860. 
Another is that if the NBN is not an ODA project compliance should still 
be had with Executive Order No. 459 dated 25 November 1997. 
The government apparently failed 
to meet the above statutory 
requirements. 
Equally important, nonetheless, is the way the government has handled 
our country's debt management which undeniably resulted in an unprecedented 
and unreasonable growth. Recent estimates on our national debt indicate a rise 
from Php2.8 trillion by the end of 2001 to Php3.3 trillion by the end of 2002 - this 
translates to an appalling increase of almost a trillion pesos a year l 
To put it in a practical manner, our debt increases by a million per minu te 
or I'hp60 million an hour or Php1.4 billion daily. 
lIenee, debt servicing has been gelling the highest budgetary allocation of 
25% at the average, more or less, of our national budget since the 1980s. 
Consequently, with debt servicing, other sectors that require funding 
continuous to suffer and these include education, health, science and technology, 
and other government programs on social progress and human development. 


This bill therefore seeks not only to rectify the mistakes discovered in the 
NBN investigation but also to institutionalize an effective check and balance on 
the executive power to contract and guarantee loans. Such power if left 
unchecked and unbridled shall continue, as it has been, to be detrimental to the 
economic and social interest of our country given its limited resources. 
It is for the above reasons, perhaps, that Section 20, Article VII of the 
Constitution is crafted in a manner that subject the above executive power, albeit 
foreign loans only, to "such limitations as may be provided by law." 
. And certainly, for the same above reasons that Congress, as an 
independent and a co-equal branch of government, must effectively pursue and 
insist on its power and prerogative to approve, determine and allocate the 
national budget of the government. 
In view of the foregoing, passage of this piece of legislation with dispatch 
is sincerely sought. 
£t 
FRANCIS G. ESCUDERO 


FIFTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First I<egular Session 
) 
) 
} 
SENATE 
S. 13. No. 2119 
, : ~ 
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Introduced by Senator FRANCIS G. ESCUDERO 
AN ACT 
CONSTITUTING A CONGRESSIONAL OVERSIGHT COMMITTEE ON 
DEBT MANAGEMENT TO LOOK INTO ALL FOREIGN AND DOMESTIC 
BORROWINGS NEGOTIATED, CONTRACTED OR GUARANTEED BY 
THE PRESIDENT ON BEHALF OF THE PHILIPPINES AS WELL AS THOSE 
BY 
THE 
GOVERNMENT 
OR 
GOVERNMENT 
OWNED 
AND 
CONTROLLED CORPORATIONS AND FOR OTHER PURPOSES 
, 
Be it eI1oe/ed by the Senate and tlze I-louse oj Representatives oj tlze Philippines in 
Congress IIsselllhled: 
SECTION 1. Declaration of Policy. - In accordance with the constitutional 
prescription on transparency and accountability, the State shall endeavor and 
pursue a debt management system that shall be made available to public 
scrutiny and subject to strict adherence to existing pertinent laws and rules and 
regulations. 
The State shall likewise ensure the most appropriate use of its 
limited resources bearing in mind the constitutional mandate of giving priority 
to education, health, science and technology, acceleration of social progress and 
promotion of total human liberation and development. 
SEC. 2. 
The Congressional Oversight Committee. - A Congressional 
Oversight Committee on Debt Management, hereinafter referred to as the 
Committee, is hereby constituted in accordance with the provisions of this Act. 
The Committee shall be composed of the Chairpersons of the 
Committee on Ways and Means of the Senate and the I-louse of Eepresentatives 
and three (3) additional members from each chamber to be designated by the 
Senate President and the House Speaker, respectively. One (1) of the said three 
(3) additional members shall come from the minority members of each chamber. 
The Congressional Oversight Committee constituted under Section 
8, paragraph c) of Eepublic Act No. 8182 shall cease to exist and is hereby 
replaced by the Committee. 
SEC. 3. 
Functions and /Juties of llze Committee. - The Committee shall 
among others, in aid of legislation: 


, 
a) 
Monitor and ensure the proper implementation of all laws, 
implementing rules and regulations, and executive issuances relating to foreign 
and domestic borrowings such as, but not limited to, Republic Act Nos. 4860 and 
8182; 
b) 
Review all documents relating to contracts, guarantees and 
negotiations on foreign and domestic borrowings. 
c) 
Review all subsisting contracts and guarantees on foreign 
and domestic borrowings; and 
d) 
Determine that the power of the President of the Republic, 
the government and government owned and controlled corporation to negotiate, 
contract and guarantee foreign and domestic borrowings is reasonably and 
legally exercised. 
The phrase foreign and domestic borrowings shall refer to such 
borrowings or loans negotiated, contracted and/ or guaranteed by the President 
on behalf of the Philippines, the government or government owned and 
controlled corporations. 
SEC. 4. 
J<cequisite AuillOrity of the Conzmzliee. - In furtherance of the 
above enumerated functions and duties of the Committee, the Committee is 
empowered to require all government agencies concerned, including the Office 
of the President, the submission of all pertinent information and data on foreign 
and domestic borrowings. Provided, however, that information or data that are 
privileged shall be furnished the Committee only in Executive Session. 
SEC. 5. 
Separnbility Clause. - If any provision of this Act or the 
application of such provision to any person or circumstance is declared invalid, 
the remainder of the Act or the application of such provision to other persons or 
circumstances shall not be affected thereby. 
Sec. 6. 
R.eperzling Clause. - All laws, decrees and orders or parts 
thereof inconsistent herewith are deemed repealed or modified accordingly. 
Sec. 7. 
EffectiVity. - This Act shall take effect after thirty (30) days 
following the completion of its publication in the Official Gazette or in two (2) 
national newspapers of general circulation . 
. Approved,