(UPDATE) A LEADING economist and former budget officials warned the Supreme Court that unprogrammed appropriations in recent national budgets pose serious risks to fiscal discipline, transparency and development goals.
Speaking as amicus curiae during oral arguments on petitions challenging the constitutionality of unprogrammed funds in the 2024–2026 General Appropriations Acts on Tuesday, former socioeconomic planning secretary Solita Monsod said the mechanism has become a vehicle for corruption and misallocation of resources.
“At the heart of this matter... is the abuse of legislative and executive power for private gain,” Monsod told the court.
She cited the Philippine Development Plan 2023–2028, saying that diverting resources from priority programs undermines national goals.
She noted that unprogrammed appropriations, originally a limited standby tool, have grown into a major budgetary instrument, reaching hundreds of billions of pesos in recent years.
Tracing developments since the Supreme Court struck down the Priority Development Assistance Fund (PDAF) in 2013, Monsod said policymakers chose to create new forms of discretionary spending rather than reform public financial management.
She warned that unprogrammed appropriations, originally intended as a standby mechanism, have “transformed into a budgetary instrument with significant implications for transparency, accountability, and fiscal discipline.”
Monsod presented data showing a sharp increase in unprogrammed appropriations beginning in 2022, with some amounts exceeding levels proposed in the National Expenditure Program.
She also noted the trend of actual revenues exceeding projections, coinciding with the expansion of unprogrammed funds.
The economist said discretionary spending distorts investment priorities, often favoring private gains over social welfare, and warned that rising deficits and debt limit the government’s ability to fund essential services in the future.
Former budget secretary Benjamin Diokno, also speaking as a resource person, echoed Monsod’s concerns, describing recent increases in unprogrammed appropriations as “particularly large” and potentially inconsistent with constitutional limits.
Drawing on his experience preparing 13 national budgets since the post-EDSA period, Diokno said such allocations are traditionally designed as standby funding for projects ready for implementation but awaiting financing.
However, he noted that from 2023 to 2025, congressional increases in unprogrammed appropriations, such as those for the Department of Public Works and Highways’ Road Users’ Fund, were unusually high, amounting to roughly P33.4 billion over three years.
“In my view, this increase is inconsistent with the constitutional provision that Congress may not increase the appropriations recommended by the president,” Diokno said.
He added that while unprogrammed funds can be justified to prevent delays in foreign-assisted projects or when actual revenues exceed projections, their expansion, especially through congressional actions, raises fiscal and constitutional concerns.
He noted that the share of unprogrammed appropriations in the total budget has varied across administrations, reaching as high as 9 percent under the current administration.
Former budget secretary Benjamin Abad, also appearing as amicus curiae, warned the court that current practices surrounding unprogrammed appropriations could undermine the Constitution’s system of accountability over public funds.
He emphasized that the national budget, as designed by the 1987 Constitution, is meant to be a structured fiscal program ensuring transparency, discipline and institutional control.
“Under normal fiscal conditions, unprogrammed appropriations are not meant to operate,” Abad said, cautioning that expanding them beyond fiscal limits shifts critical allocative decisions from Congress to the executive during budget execution.
He described such practices as creating opaque instruments of spending that weaken transparency, undermine accountability, and risk bypassing constitutionally mandated budget ceilings.
All three experts agreed that while unprogrammed appropriations serve a legitimate function, their unchecked growth and misuse could weaken congressional control over public funds, distort investment priorities, and generate significant economic costs, leaving future generations to bear the fiscal burden.