What happens now?

The Supreme Court's recent ruling has declared certain controversial budget allocations for the years 2024, 2025 and portions of the 2026 national budget unconstitutional. Despite the money having been spent or potentially misappropriated, the court applied the doctrine of operative fact, meaning it does not require the money to be returned, assuming those involved acted in good faith.

However, this good faith defense has been called into question, with officials allegedly knowing their actions were not for the public good and seeking personal gain through kickbacks. The Solicitor General advised the President and budget department to stop spending on the unconstitutional parts of the 2026 national budget, but little evidence suggests that most of the unspent funds have been misused.

Nonetheless, those who enacted or implemented the unconstitutional provisions could face civil, criminal or administrative liability if found to have acted in bad faith, a challenge considering the complexity of the judicial system.

The ruling primarily serves as a constitutional safeguard for future budget-making, preventing Congress from inflating unprogrammed standby funds beyond the President's recommended ceiling. However, the ruling does not necessarily compel the government to claw back past expenditures. Legislators are known for finding ways to circumvent rulings, and the same is expected with this particular decision.

The Senate, currently working on the 2027 budget bill, will need to address the inclusion of unprogrammed items and lump-sum provisions introduced by the House. Civil society watchdogs have expressed concerns over P179 billion in last-minute pork-like insertions into public works and the slashing of P93 billion from foreign-assisted infrastructure projects.

The Supreme Court ruling explicitly prohibited lack of transparency, permanently prohibiting overly broad, unitemized provisions that lacked prioritization standards and essentially functioned as illicit lump-sum appropriations. The Senate President has announced plans to remove the unconstitutional spending provisions and tighten safeguards on the remaining P111.2 billion in proposed unprogrammed appropriations.

While the public may perceive a complete betrayal of public trust, the legal ramifications may not be as severe. The Supreme Court's ruling is about the constitutionality of the law, not individual criminal guilt. The Ombudsman must investigate potential grave misconduct or violation of the Constitution by the President (after his term, due to presidential immunity), former Budget Secretary, or congressional leaders.

If probable cause is found, charges must be filed and proven in the Sandiganbayan. However, if congressional leaders claimed benefits or directed money to ghost, bloated or substandard projects, they may lose their legal shield of good faith. Ultimately, the public will have to wait and see how the Senate handles the 2027 budget bill and what consequences, if any, will befall those responsible for these unconstitutional budget actions.