Good faith implementation

A lot has been said about the recent decision of the Supreme Court declaring as unconstitutional a provision in the 2024 General Appropriations Act (GAA) which mandated the transfer of P89.9 billion in funds of the Philippine Health Insurance Corp. (PhilHealth) to the Treasury.

- MARY ANN LL. REYES

The SC ordered the government to return to PhilHealth P60 billion in funds already transferred to the Treasury and prohibited the transfer of the remaining P29.9 billion.

There are those who blame then finance secretary and now Executive Secretary Ralph Recto for the transfer.

What they fail to mention is that Special Provision 1(d), Chapter XIII of the 2024 GAA, a creation of Congress under House Bill 8980 which was signed into law by the President as Republic Act 11975, directed the Department of Finance (DOF) to issue the guidelines to implement the said provision.

Special Provision 1(d) specifically authorized the return of the “fund balance” or excess “reserve funds” of government-owned and -controlled corporations to the National Treasury to fund unprogrammed appropriations under the 2024 GOCC.

By virtue of this provision, the DOF issued DOF Circular 003-2024 on Feb. 27, 2024 requiring GOCCs such as PhilHealth to remit their fund balance to the Treasury.

Former finance secretary Gary Teves, acting as amicus curiae or friend of the court, said in a memorandum submitted to the SC that Recto and the DOF complied with Special Provision 1(d) in issuing the said DOF circular since it was done in close coordination with the relevant GOCCs to determine a reasonable amount called the “fund balance” that can be remitted to the Treasury.

He also said that the remittance followed proper procedure as the P89.9 billion was only remitted by PhiHealth after securing a favorable opinion from the Office of the Government Corporate Counsel (OGCC), Governance Commission for GOCCs (GCG) and the Commission on Audit (COA).

In its ruling, the Supreme Court said that the President did not commit grave abuse of discretion when he certified as urgent House Bill 8980.