Republic of the Philippines
HOUSE OF REPRESENTATIVES
Batasang Pambansa, Quezon City

FIFTEENTH CONGRESS
First Regular Session

House sino. 2°73

INTRODUCED BY REP. JOSEPH VICTOR G. EJERCITO

EXPLANATORY NOTE

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 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 he 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. =

—

JOSEPH VICTOR G. EJERCITO


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Batasang Pambansa, Quezon City

FIFTEENTH CONGRESS:
First Regular Session

HOUSE BILL NO.

INTRODUCED BY REP. JOSEPH VICTOR G. EJERCITO

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.

poo
(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 OPERATION 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 funds 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
APPROPRIATIONS. -

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 UNEXPENDED 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 implementation 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 year.]

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:

292 ai

~ XXX

“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 A RE-
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
ire 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.

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:

peed

(6) PURSUANT TO SECTION 39 OF THIS BOOK, the Secretary
shall have NO authority to modify 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, reduce 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 O 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 to 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 THE 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 concerned, 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:

XXX

XXX

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. -

SEC. [42] 43. Adjustment of Appropriations for Reorganization. -

SEC. [43] 44. Liability for Illegal 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,