Philippines’ Top Leaders Accused of Making Irregular Budget Transactions

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Philippines’ Top Leaders Accused of Making Irregular Budget Transactions

Vice President Sara Duterte’s use of confidential and intelligence funds (CIFs), which are usually reserved for the security forces, has raised eyebrows.

Philippines’ Top Leaders Accused of Making Irregular Budget Transactions

Philippine Vice President Sara Duterte delivers a speech in Davao City, southern Philippines, September 12, 2023.

Credit: Facebook/Inday Sara Duterte

Opposition lawmakers in the Philippines are questioning the use of confidential funds by Vice President Sara Duterte in 2022, which they claim were in some cases even allocated by President Ferdinand Marcos Jr. without the authorization of Congress.

The Marcos government assumed power on June 30, 2022, which means the budget it used for the last half of the year was deliberated and approved by Congress in 2021. Under this budget, the office of vice president has no provision for confidential and intelligence funds (CIFs). The CIF is often given to security forces for their surveillance and intelligence-gathering operations. Because of the sensitivity of this work, the CIF is not subject to the standard auditing and accounting mechanisms required for other items in the budget expenses of agencies.

While Congress was deliberating the proposed 2024 budget of the Marcos government, opposition legislators from the Makabayan bloc flagged the allocation of CIF for Duterte’s office, which is even bigger than the CIF of the Department of National Defense and the National Intelligence Coordinating Agency. They also questioned the allocation of CIF for the Department of Education, an agency headed by Duterte.

In addition to this, the bloc shared official budget documents showing that Duterte used confidential funds in December 2022, which were sourced from a transfer made by Marcos’ office.

However, the legislators were never able to extract a response from Duterte because her allies terminated the proceedings after swiftly approving the budget request of the vice president.

It was a different case in the Senate because the two opposition members were able to raise the irregular use of confidential funds by Duterte in 2022 and her CIF request for 2024.

The former spokesperson of former Vice President Leni Robredo confirmed that her office didn’t request the CIF in the 2021 budget. Hence, Duterte’s use of confidential funds in December 2022 could be a violation of the law. Former Senate President Franklin Drilon said that the transfer made by the office of the president violated budget rules.

“There was no item. Since there was no item then you could not augment. The key is augmentation. If there is zero budget, what can you augment? There is no deficiency in the item that needs augmentation,” he said in a media interview.

In response, Marcos’ executive secretary, Lucas Bersamin, said that the president is authorized to support government programs through the use of contingent funds.

“VP Sara, who was newly elected then, needed funds for her new programs for the remaining period of 2022. The president supported this initiative and released the funds, with the favorable recommendation of the (Department of Budget and Management),” said Bersamin in a statement.

Interestingly, it was Bersamin, a former chief justice of the Supreme Court, who penned the landmark decision in 2014 that voided the transfer of budget from one agency to another to fund projects that are not covered in the approved budget law.

For her part, Duterte is adamant that she is entitled to use CIF by maintaining that the education sector is “intertwined with national security.” She added that the CIF is necessary for the “safe, secure and successful implementation” of the projects of her office.

Bersamin and Duterte actually confirmed that a transfer in the budget was made in the last quarter of 2022. In their attempt to justify the use of confidential funds, they identified the projects spearheaded by the vice president during that period. But perhaps they overlooked that the government has specific guidelines for the use of CIF; unfortunately, tree planting and building satellite offices are not among the allowed activities in the rules.

Marcos and Duterte could be held liable for violating the constitution but impeaching them is out of the question given their almost absolute control of both houses of Congress. However, it will probably take some time before they can overcome the stigma of being involved in a highly irregular and possibly illegal budget transaction. It could also potentially undermine the electoral chances of Duterte in the 2028 presidential election.

The opposition has succeeded in pointing out a disturbing trend related to the use of CIF in supposedly civilian agencies. It alerted the public about a portion of the budget that is beyond Congress scrutiny because it is allegedly being used for national security. The good thing is that the Senate leadership has vowed to review the rules about the use of CIF.

Naturally, it doesn’t look good that almost five billion pesos are allotted for the CIF of Marcos, Duterte, and an increasing number of agencies at a time when the government’s economic managers are proposing to reconsider free college education because of its alleged negative impact on the national treasury. Under the same budget proposal, funds for several specialty hospitals will be slashed as well.

After the Senate hearing, Duterte lashed back at critics and defended the use of CIF. Maybe she should listen to the advice of a veteran legislator who urged her to voluntarily withdraw the CIF in her budget proposal and use it instead to address the basic problems besetting the education sector.