MANILA, Philippines — The Supreme Court declared unconstitutional key provisions of the 2024, 2025, and 2026 General Appropriations Acts (GAA) over unauthorized congressional increases to unprogrammed standby funds and specific special accounts.
In a decision penned by Senior Associate Justice Marvic Leonen and released on October 7, the high court’s En Banc declared Republic Act No. 11975, or the 2024 GAA, unconstitutional after Congress increased unprogrammed appropriations by P449.5 billion.
The ruling also granted the petition filed by the late lawmaker Edcel Lagman and several others and partly granted the petition of former Sen. Aquilino Pimentel III.
The high court likewise granted the petition filed by the Filipinos for Peace, Justice and Progress Movement, Inc. et al., declaring RA 12116, or the 2025 GAA, unconstitutional due to a P17.99-billion increase made by lawmakers to the Department of Public Works and Highways (DPWH) Special Road Fund.
Additionally, the high court found that a P12.75-billion increase in Special Accounts in the General Fund (SAGF) across certain agencies violated the Administrative Code, which bars Congress from inflating special provision amounts beyond the President’s original proposal.
Acting on a petition by lawmakers Edgar Erice and Leila De Lima, the Court also voided Special Provisions 1(a) and (b), Chapter XLIII of the 2026 GAA, issuing a permanent injunction against the Senate, House of Representatives, Office of the Executive Secretary, and Department of Budget and Management from implementing them.
The Supreme Court explained that unprogrammed appropriations, which are contingent or standby authorizations released only when excess revenues or non-tax funds materialize, are not unconstitutional per se.
According to the high court, such standby funds become invalid when they lack clear standards, as this effectively gives the Executive unchecked spending power, compromises funding for programmed projects when revenue projections fall short, and violates the constitutional budget ceiling under Article VI, Section 25(1), which applies to combined programmed and unprogrammed allocations.
What was struck down
The High Court ruled that the 2024 General Appropriations Act was unconstitutional because Congress, through the Bicameral Conference Committee, bloated unprogrammed allocations by P449.5 billion.
This massive upward adjustment raised the unprogrammed budget from the President's proposed P281.9 billion in the National Expenditure Program to P731.4 billion in the final law.
The high court explained that the constitutional prohibition against Congress increasing the President's recommended budget applies to the total sum of both programmed and unprogrammed appropriations.
By leaving the programmed budget unchanged while heavily inflating unprogrammed items, Congress effectively bypassed the Executive's spending ceiling.
“The purpose of Article VI, Section 25(1) of the Constitution, which prohibits Congress from increasing the appropriations recommended by the president, is to maintain fiscal discipline and prevent excessive public expenditures that could balloon the budget deficit. This constitutional limit requires that the national budget be anchored on the Executive's projections of revenues and expenditures and on a coherent fiscal plan based on actual economic realities,” the Supreme Court said.
The decision also struck down the "Strengthening Assistance for Government Infrastructure and Social Programs," popularly known as SAGIP, which was included in the 2024 and 2025 budgets.
The high court classified SAGIP as a prohibited lump-sum appropriation that gave the Executive unchecked post-enactment discretion to identify projects and allocate funds.
According to the Supreme Court, this mechanism allowed the Executive to act as a legislative authority after the budget had already passed, subverting the constitutional process of presentment and impairing the President's item-veto power.
“SAGIP is similarly unconstitutional because it is a prohibited lump sum appropriation, as defined in Belgica v Ochoa. It provides a singular lump sum amount as a source of funding for multiple purposes,” the Supreme Court said.
“Through the SAGIP lump sum appropriation, the Executive had increased latitude to determine spending priorities after the budget has been enacted. There is weakened transparency and accountability because the specific projects are itemized only during the execution stage, without the benefit of public discussion and oversight. This effectively diluted Congress's control over public spending in contravention of Constitutional safeguards,” it added.
Furthermore, under the 2025 General Appropriations Act, the Supreme Court declared the P17.992-billion increase in the programmed line-item appropriation for the Special Road Fund unconstitutional.
The fund, sourced from Motor Vehicle User's Charge collections, is a statutorily earmarked Special Account in the General Fund.
The high court ruled that while Congress generally has the discretion to supplement such funds, the Administrative Code explicitly prohibits the legislature from increasing the amounts specified in special provisions beyond what is proposed by the President.
For the 2026 General Appropriations Act, the Court nullified Special Provisions 1(a) and 1(b) under Chapter XLIII, which authorized the use of unprogrammed funds based on excess collections from individual non-tax revenue sources or new revenue streams.
The high court reaffirmed its previous doctrine that unprogrammed funds can only be triggered when aggregate revenue collections exceed the total revenue targets assumed in the Budget of Expenditures and Sources of Financing.
According to the Supreme Court, pegging triggers to individual or isolated revenue sources creates an "artificial surplus" that disregards the overall budget plan, fosters deficits, and violates the Constitution.
“Furthermore, from a genuine surplus originally contemplated to fund the unprogrammed appropriations, the fiscal triggers morphed into an artificial surplus brought about by a change in the reckoning of excess revenues from total/holistic view to individual revenue targets,” the Supreme Court said.
Consequently, the Senate, the House of Representatives, the Office of the Executive Secretary, and the Department of Budget and Management have been permanently prohibited from implementing these specific provisions of the 2026 GAA.
While the Court applied the doctrine of operative fact to protect the programs, projects, and good-faith beneficiaries who had already relied on the 2024 and 2025 budgets, it explicitly excluded the authors, proponents, and implementors of the unconstitutional provisions from this protection.
The ruling leaves these public officials open to potential civil, criminal, and administrative liabilities unless they can prove before the proper tribunals that they acted in good faith.
“However, this protection does not extend to the authors, proponents, and implementors of the aforementioned laws. These officials remain subject to criminal, civil, and administrative liability unless the proper tribunals explicitly find that they acted in good faith,” the Supreme Court said.