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SC to decide Drug war, POGOs, PhilHealth fund issues
By J.Lo
“Such statements coming from second highest official of the land, seen and heard by millions of Filipinos, are undoubtedly illegal, immoral and condemnable…as lawyer herself, she should be disbarred,” anti-poverty czar Larry Gadon, disbarred lawyer himself said Supreme Court (SC) should initiate “motu proprio proceeding of disbarment” against Vice President Sara Duterte-Carpio, whose statements are “undoubtedly illegal, immoral and condemnable.”
Controversial issues plagued the nation throughout the year from investigations into alleged human rights violations during previous administration’s drug war reached International Criminal Court, uncovering of illegal activities in Philippine offshore gaming operator (POGO) hubs that led to downfall of the industry, and inquiries into use of public funds by country’s second-highest ranking official in the country.
Some of these issues landed in SC, has the duty to settle actual controversies involving rights that are legally demandable and enforceable and to determine if any branch or instrumentality of government has acted with grave abuse of discretion amounting to lack of excess of jurisdiction.
Among contentious issues that shook the nation is diversion of P89.9-billion unused funds from Philippine Health Insurance Corporation (PhilHealth) to national treasury in bid to augment unprogrammed appropriations in 2024 budget.
Issue has sparked debate among lawmakers, health care professionals and public, raising concerns about legality and ethical implications of diverting funds earmarked for health care to other budgetary needs.
It all started when Department of Finance (DOF) issued Circular No. 003-2024, directed transfer of unused subsidies from government-owned and controlled corporations (GOCCs), specifically PhilHealth, to national treasury to bolster government’s unprogrammed appropriations.
Unprogrammed funds are those included in government’s budget serve as financial reserve for projects, programs or expenses that are not specifically itemized or detailed in the budget.
These funds serve as contingency fund, allows government to address unforeseen or emergency expenditures that arise during fiscal year.
This directive sparked concerns on legality of circular, prompting several groups to file petition for certiorari before SC.
Three petitions have been consolidated have been filed before SC.
Petitioners include Sen. Aquilino Pimentel III, former Department of Finance (DOF) undersecretary Cielo Magno, Bayan Muna party-list and 1Sambayan Coalition led by former Supreme Court Associate Justice Antonio Carpio.
Named respondents were Finance Secretary Ralph Recto, House of Representatives represented by Speaker Martin Romualdez, Senate represented by Senate President Francis Escudero, Executive Secretary Lucas Bersamin and PhilHealth represented by its president Emmanuel Ledesma Jr.
All petitions claimed as unconstitutional Chapter XLIII of 2024 General Appropriations Act (GAA), contains this year’s national budget, allowed excess reserve funds of government-owned and -controlled corporations (GOCCs), like PhilHealth, to be returned to national treasury to augment unprogrammed appropriations.
They also challenged legality of DOF Circular 003-2024, based on said GAA provision, requiring GOCCs to remit their fund balance to national coffers.
Petitioners argued transfer is unconstitutional and threatens implementation of Universal Health Care Act and other health care initiatives.
They also argued that transfer of PhilHealth funds to national treasury constitutes “technical malversation” because funds were diverted to “some public use other than that intended by law.”
PhilHealth funds, they said, are considered as special funds because they are collected for specific purpose, for health insurance, and unused or idle funds cannot be classified as government savings.
Petitioners also asked SC to issue temporary restraining order (TRO) to block implementation of assailed DOF circular and provision in GAA 2024. One of the petitions also asked for status quo ante order, would order return of funds already transmitted to national treasury.
Office of the Solicitor General (OSG), represents government in the case, earlier asked SC to dismiss petitions challenging constitutionality of PhilHealth fund transfer it said, “when viewed from broader perspective, will not necessarily hamper, much less disable, implementation of PhilHealth’s mandate.”
OSG pointed out that aside from its annual net income averaging more than P100 billion in the past three years, PhilHealth has reserve fund over P480 billion as of March of this year, “highlighting its strong fiscal position.”
In October, SC issued TRO against further transfer of PhilHealth funds to state coffers.
PhilHealth has so far remitted to national treasury first tranche of P20 billion in May and another P10 billion in August. State insurer then remitted third tranche of diversion amounting to P30 billion in October.
Remaining P29.9 billion was supposed to be transferred in November.
According to SC, it is still possible for SC to issue status quo ante order.
SC has set oral arguments on petitions on Feb. 5, 2025.
Another public interest case lodged before SC is issue on contract between Commission on Elections (Comelec) and South Korean firm Miru Systems for conduct of upcoming 2025 national elections.
Comelec has replaced Smartmatic after Miru won big-budget deal to deploy voting machines to the Philippines for next year’s polls, with P17.9-billion budget.
Polling body will replace Smartmatic’s decade-old vote-counting machines Filipinos have used since 2016 elections.
Former lawmaker Edgar Erice filed petition for certiorari before SC in April 2024, asked high tribunal to declare null and void contract between Comelec and Miru for allegedly violating law on automated elections.
Erice asked SC to issue restraining order or writ of preliminary injunction to stop Comelec from implementing polling body’s resolution awarding project to Miru.
Former lawmaker argued contract between Miru and Comelec violated Republic Act 7369 or Automated Election Law.
Erice also noted that government will spend P17.99 billion for automated election, first time as government only spent about P6 billion in the past five elections.
Smartmatic was earlier disqualified by Comelec from participating in all of its procurements, but this was later reversed by SC.
SC had ruled Comelec committed grave abuse of discretion when it disqualified Smartmatic before it could submit any bids.
In its ruling, SC did not nullify public bidding or award of contract granted to Miru Systems, won public bidding.
High Court cited considerations of equity, justice and practicality, as well as doctrine of operative fact, to hold that its findings will not affect 2025 polls.
High tribunal has so far ordered Comelec and Miru to comment on Erice’s petition.
While disbarment complaints, in themselves, are not controversial, it becomes public interest when second-highest ranking official of the country is facing one.
Duterte, a lawyer, is facing disbarment complaint filed by Gadon, disbarred lawyer himself.
Reason for complaint, Duterte’s expletive-filled remarks and her alleged assassination threat against President Ferdinand Marcos Jr. and some of his family members aired in midnight press conference in November.
Gadon said SC should initiate “motu proprio proceeding of disbarment” against Duterte, whose statements are “undoubtedly illegal, immoral and condemnable.”
He noted that Duterte’s remarks had been seen by millions of Filipinos, reported on television, radio and newspapers and now has become general public knowledge that “ Court may take judicial notice.”
Gadon said disbarment proceedings against Duterte will test SC’s fairness, noting that high tribunal did not disbar nor suspend the Vice President when as then Davao City mayor, she punched sheriffs enforcing court order to dismantle informal settlers’ community.
Under the law, “proceedings for disbarment, suspension or discipline of attorneys may be taken by Supreme Court motu proprio, or upon filing of verified complaint of any person before Supreme Court or Integrated Bar of the Philippines (IBP).”
According to SC, it has received “anonymous” disbarment complaint against Duterte over her remarks of exhuming remains of former President Marcos Sr. and throwing them to t West Philippine Sea.
High tribunal has yet to act on this.
There is likewise pending disbarment case against Sara s filed when she was still Davao City mayor.
Another possible ground for Duterte’s disbarment is when she acted as counsel for her chief-of-staff Zuleika Lopez, according to NBI director Jaime Santiago.
This, he explained, is prohibited under the Constitution as public officials are barred from practicing their profession while holding office.
According to former IBP president Domingo Cayosa, there are lawyers who have been disciplined by IBP and Supreme Court over saying expletives. They either received warnings or suspensions and even disbarment.
Cayosa also said Duterte’s assassination remark violates Canon 1 of the Code of Professional Responsibility and Accountability (CPRA), states that lawyer shall uphold Constitution and obey laws of the land and promote respect for law and for legal processes.
He said Duterte’s remarks of contracting hitman to kill individuals either preemptively or out of revenge is “not respect for law and legal processes.”
Public interest case SC has yet to decide on are petitions challenging legality of transfer of P125 million of confidential funds to the Office of the Vice President in December 2022 and those questioning constitutionality of government public utility vehicle modernization program.
SC has consolidated petitions, filed in 2023, that are challenging t constitutionality of so-called confidential funds given to OVP in 2022.
Two petitions have been filed before SC that challenges legality of Office of the President (OP)’s move to allow budget department to release P125 million in confidential funds to OVP in December last year, which was reportedly spent in just 11 days.
Petitioners argued that there was no line item in OVP for confidential funds under 2022 national budget.
Also in November, retired SC senior associate justice Antonio Carpio led filing of petition for certiorari and mandamus, with urgent prayer for issuance of temporary restraining order, against use of general funds in general.
Petitioners asked SC to declare null and void Joint Circular No. 2015-01, guides use and auditing of confidential funds.
Duterte has asked high tribunal to junk petitions, saying there is no actual case or controversy to resolve.
Duterte argued petitions, sought to have transfer of funds declared as unconstitutional, do not show an actual case or controversy nor alleged legally demandable and enforceable right, calls for exercise of judicial power.
“Petitions are mere apprehension and speculation about contingent funds or confidential funds, does not constitute justiciable controversy,” 19-page consolidated comment filed in May 10 read.
Duterte said SC should not decide on “mere academic questions to satisfy scholarly interest,” pointing out petitions do not even accuse her of committing grave abuse of discretion.
She also pointed out that petitions for certiorari did not show that she is tribunal, board or officer exercising judicial or quasi-judicial function nor alleged that she exercised grave abuse of discretion.
“Petitioners said they will suffer or have suffered any concrete injury resulting from act supposedly committed by VP Sara ‘with grave abuse of discretion.’ Petitioners simply made blanket allegation that they are taxpayers or concerned citizens but without constitutional requirement of justiciability,” she said.
Vice President also argued even if SC is vested with judicial power, it does not follow that it should resolve every question that it may have authority to answer.
“To conclude, it is important to state that courts do not sit to adjudicate mere academic questions to satisfy scholarly interest therein, however intellectually solid the problem may be,” Duterte said.
In her comment, Duterte said her office endeavored to bring services closer to public through satellite offices in the country.
Department of Budget and Management (DBM) then gave favorable recommendation to OP and identified funds to be released to OVP would come from Contingent Funds of General Appropriations Act, contains national budget.
Upon recommendation of DBM, President Marcos granted release of funds to OVP.
Aside from Duterte, Bersamin and Pangandaman, Senate led by then president Juan Miguel Zubiri, House of Representatives led by Speaker Martin Romualdez and some officials of Departments of Education, of Budget and Management and of the Interior and Local Government were named respondents.
Concerns over use of confidential funds were prompted due to Commission on Audit (COA) report found OVP spent P125 million in just 11 days. Issues raised include how confidential and intelligence funds are much more difficult to audit as they are exempted from COA’s standard procedures.
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