The Supreme Court (SC) has upheld the constitutionality of unprogrammed appropriations while setting limits on Congress’ authority to increase the national budget and the Executive’s discretion over public spending.

In a decision penned by Senior Associate Justice Marvic M.V.F. Leonen, the SC En Banc ruled that unprogrammed appropriations remain permissible as contingent spending authority, subject to safeguards against lump-sum allocations, insufficient spending standards, and departures from the national fiscal framework.

“Unprogrammed appropriations per se are not constitutionally proscribed, and it allows the president the flexibility to adequately respond and cope with unforeseen developments in the domestic and world economy,” the Court held.

The Court granted two petitions and partly granted two others in the consolidated cases filed directly before the SC.

The SC invalidated a P449.5-billion increase in unprogrammed appropriations under the 2024 General Appropriations Act (GAA), certain provisions of the 2026 GAA, and a P17.99-billion increase in the Special Road Fund under the 2025 GAA.

It further permanently prohibited the Senate, House of Representatives, Office of the Executive Secretary, and Department of Budget and Management from implementing Special Provisions 1(a) and 1(b), Chapter XLIII, of the 2026 GAA.

In the interest of justice and equity, the Court applied the doctrine of operative fact to recognize the effects of prior implementation of the unconstitutional appropriations, particularly on government programs and projects that had already benefited from the funds.

However, it clarified that the doctrine does not extend protection to those responsible for enacting or implementing unconstitutional measures, particularly when they acted in bad faith.

In resolving the petitions, the Court made the following findings on the safeguards governing unprogrammed appropriations and the constitutional limits on congressional and executive authority over public spending:

Unprogrammed appropriations remain constitutional

Unprogrammed appropriations provide standby authority to fund government programs and projects, subject to the availability of additional funding sources and compliance with legally prescribed conditions.

The Court held that these appropriations are not inherently unconstitutional, recognizing their role in financing government programs and projects when additional resources become available.

However, it prohibited lump-sum unprogrammed appropriations and required Congress to establish sufficient standards for prioritizing expenditures when multiple spending purposes are authorized.

The SC further directed Congress to distinguish spending intended to address fiscal deficits from expenditures funded through additional income or other non-tax revenues, ensuring that unprogrammed appropriations remain narrow, contingent, and consistent with the national fiscal framework.

P449.5-billion budget increase unconstitutional

The Court declared unconstitutional Congress’ P449.5-billion increase in unprogrammed appropriations under the 2024 GAA for violating Article VI, Section 25(1) of the Constitution.

Under the 2024 GAA, Congress raised the proposed unprogrammed appropriations from approximately P282 billion in the National Expenditure Program to P731 billion.

Petitioners argued that the increase violated the constitutional prohibition against Congress increasing the appropriations recommended by the President.

The SC ruled that the prohibition applies to the total national budget, including programmed and unprogrammed appropriations.

It further found that Congress transferred certain programs and projects from programmed to unprogrammed appropriations, reducing their funding certainty and raising concerns over transparency and accountability in public spending.

2026 budget provisions constitute undue delegation

The SC invalidated Special Provisions 1(a) and 1(b), Chapter XLIII, of the 2026 GAA, which governed the availability of unprogrammed appropriations based on excess revenue collections and new revenue sources.

The Court found that the provisions granted the Executive excessive discretion to determine which programs would receive funding and how much would be allocated, without sufficient legislative standards governing those decisions.

It emphasized that Congress must establish sufficient standards governing the purposes, allocation, and prioritization of appropriations rather than leave such determinations to executive discretion.

P17.99-billion Special Road Fund increase invalidated

The Court likewise struck down the P17.99-billion increase in the Special Road Fund under the 2025 GAA for exceeding the President’s recommended appropriations.

However, it distinguished this unconstitutional increase from adjustments to existing appropriations in special accounts within the General Fund, which are covered by special laws and do not fall under the prohibition in Article VI, Section 25(1).

Nevertheless, the SC ruled that increases in the allotted amounts of these special accounts under the 2025 GAA violated Section 25, Chapter 4, Book VI of the Administrative Code of 1987.

Bicameral panel exceeded its authority

The SC found that the Bicameral Conference Committee gravely abused its discretion when it increased unprogrammed appropriations by P449.5 billion under the 2024 GAA.

It ruled that the increase exceeded the committee’s authority to reconcile differences between the House-approved and Senate-approved versions of the budget, resulting in an unconstitutional increase in the President’s recommended appropriations.

“Ratification by both Houses of Congress will not cure the defect of the action taken by the Bicameral Conference Committee,” the decision read.

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