SIXTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session 
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SENATE 
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Senate Bill No. 2751 
Prepared and submitted by the Committee on Finance, with Senators Defensor-
Santiago, Ejercito, Ejercito Estrada, Guingona and Escudero as authors thereof 
THE BUDGET IMPOUNDMENT CONTROL ACT 
Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled: 
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SECTION 1. Title. - This Act shall be known as the Budget Impoundment Control Act of 
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2015, 
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SEC. 2. Declaration 0/ Policy. - It is hereby declared the policy of the State to formulate and 
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implement a National Budget that is truly an instrument of national development. Towards this end, all 
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appropriations, except those which shall be deferred, rescinded, reserved, or otherwise withheld in the 
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General Appropriations Act (GAA), shall be considered released upon its effectivity and shall be 
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utilized according to the purposes provided therein, Any deferral, rescission or reservation of 
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appropriations in the GAA shall be in accordance with this Act. 
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SEC. 3. Definition o/Terms. - For purposes ofthis Act: 
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a, Impoundment - refers to the refusal of the President to release duly appropriated funds for 
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program/activity/project (P/A/P) of government entities such as National Government 
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agencies (NGAs), State Universities and Colleges (SUCs), Government-Owned and 
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Controlled Corporations (GOCCs), and local government units (LGUs), except Judiciary, 
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Constitutional Offices (Cos) and Congress, with the intention of cancelling or delaying its 
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utilization, Impoundment may be through: 
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1) 
Rescission - means cancellation of all or part of an enacted appropriation, which has not 
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yet been released; 
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2) 
Deferral - means temporarily withholding of the release of all or part of an enacted 
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appropriation of selected government entities, 
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b. Impoundment Proposal - refers to the Presidential message sent to both Houses of Congress 
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that contains the request for the rescission or deferral of duly appropriated funds for PIAIP. 
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c. Impoundment Resolution - refers to a joint resolution of the House of Representatives and 
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the Senate which expresses Congressional approval or disapproval of each request contained 
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in the President's impoundment proposal. 
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d. Reservation - refers to the imposition of reserves on appropriated amounts for government 
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expenditures under the annual GAA. 
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e. Appropriations - unless otherwise described or specified herein, the term appropriations 
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refers to the funds for P/ AlP included in the annual GAA. 
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f Program/Activity/Project (PiA/P) 
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1) Program - is an integrated group of activities that contributes to an agency or 
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department's continuing objective. 
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2) Activity - is defined as a work process that contributes to the fulfilment of a program or 
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project. 
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3) Projects - are special department/agency undertakings carried out within a definite 
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timeframe, and which are designed to produce a pre-determined measure of goods or 
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services/major final output (MFO). It is considered an investment toward expanding the 
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capacity of a department/agency to deliver goods or services/MFOs. 
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SEC. 4. Impoundment Proposal. - An impoundment proposal must be transmitted to both 
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Houses of Congress, whenever the President, upon the recommendation of the Department of Budget 
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and Management (DBM) determines that all or part of any duly appropriated fund: 
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a) is not necessary to fulfill the objectives of the programs, activities, projects originally 
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sought to be achieved by the same appropriation; and/or 
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b) must be rescinded or deferred for fiscal policy or due to the termination of authorized P/ AlP 
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for which funds have been duly appropriated. 
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SEC. 5. Contents of the Impoundment Proposal. - Whenever the President transmits an 
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impoundment proposal for the rescission or deferral of duly appropriated funds, the following 
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information must be indicated: 
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a) the PI AlP and the amount proposed to be rescinded or deferred of the affected governnient 
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entities; 
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b) the reasons why these duly appropriated funds are to be rescinded or deferred; 
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c) the estimated fiscal, economic, and budgetary effects ofthe rescission proposal or deferral; 
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d) the effect of the rescission or deferral on the performance target for which the amount was 
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provided; 
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e) for deferrals, indicate the period covered for the deferment. A deferral shall not extend 
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beyond the fiscal year in which the impoundment proposal is transmitted to both Houses of 
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Congress; and 
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f) any other relevant facts, circumstances, and considerations relating to the proposed 
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rescission or deferral. 
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SEC. 6. Impoundment Resolution. - Both Houses of Congress must act on the proposed 
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rescission or deferral within forty-five (45) calendar days after the receipt of the impoundment 
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proposal from the President by issuing a Joint Impoundment Resolution. Within the same period of 
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forty-five (45) calendar days mentioned above, the specific PlAIP indicated in the Impoundment 
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Proposal is temporarily withheld. Congressional inaction, within the 45-day period, is equivalent to a 
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disapproval of the impoundment proposal. 
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SEC. 7. Imposition and Use of Reserves. - The imposition of reserve on funds appropriated 
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under the GAA shall require due notice to Congress and shall only be imposed when there is 
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unmanageable National Govermnent budget deficit. Umnanageable National Govermnent deficit shall 
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be construed to mean that: (i) the actual National Govermnent deficit has exceeded the quarterly 
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budget deficit targets consistent with the full-year target deficit as indicated in the BE SF submitted by 
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the President and approved by Congress pursuant to Section 22, Article VII of the Constitution; or (ii) 
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there are clear economic indications of an impending occurrence of such condition, as determined by 
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the DBCC and approved by the President. 
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Reserve shall be applied uniformly among all govermnent entities which shall include NGAs, 
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SUCs, GOCCs, LGUs and special purpose funds. No reserve shall be imposed on the appropriations 
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for the Judiciary, Constitutional Offices and Congress. 
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When changes in conditions during the year justify the partial or full release of the reserved 
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appropriations which have been imposed under this Act or under the General Appropriations Act, the 
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amount involved shall be allocated back for the use by the department, office or agency and special 
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purpose funds on whose appropriation the reserve was originally imposed: PROVIDED, That in case 
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of partial release of reserve, the same shall be proportionately released among the National 
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Government entities and special purpose funds. 
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SEC. 8. Period for Transmittal of Impoundment Proposal. - The President shall transmit an 
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impoundment proposal to both Houses of Congress at any time during the budget year but not later 
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than ninety (90) days from the effectivity of the GAA. 
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SEC. 9. Reversion of Rescinded and Reserve Fund. - Unexpended funds due to the rescission 
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of appropriations shall automatically revert to the National Treasury while reserve funds shall revert to 
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the National Treasury at the end of the year. The reverted funds shall not be made available for 
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expenditure unless thru an appropriation law. 
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SEC. 10. Betrayal of Public Trust. - Failure, on the part of the President, to comply with the 
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requirements for impoundment within the given period, as provided in this Act, amounts to a grave 
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betrayal of public trust. 
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SEC. 11. Separability. - Provisions herein which may be declared unconstitutional shall not 
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revoke the effectivity and enforcement of other provisions of this Act. 
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SEC. 12. Repealing clause. - All laws, decrees, executive orders, rules and regulations, and 
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other issuances inconsistent with this act are hereby repealed or amended accordingly. 
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SEC. 13. Effectivity. - This Act shall take effect after thirty (30) days from publication. 
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Approved, 
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