National Electrification Adm. v. COA, 377 SCRA 223 (2002)

National Electrification Adm. v. COA, 377 SCRA 223 (2002)

Facts: The National Electrification Administration (NEA) is a government-owned and controlled corporation created under Presidential Decree No. 269 with the responsibility of organizing, financing and regulating electric cooperatives throughout the country. on July 1, 1989, a Republic Act (“RA 6758”), entitled “An Act Prescribing A Revised Compensation and Position Classification System in the Government and For Other Purposes”, took effect. RA 6758 provided, among others, a salary schedule for all government positions, appointive or elective, including positions in government-owned or controlled corporations and government financial institutions. In response to pressing economic difficulties, and the need to levitate the plight of government personnel, the Senate and the HR urged the President, through a joint resolution to increase the salary of government employees. President Ramos acted on the joint resolution and issued EO 389 which directed payment of the fourth and final salary increases authorized under Joint Resolution No. 1 in two trenches. NEA implemented the salary increase but it did not do so in two trenches. COA resident auditor issued a notice of suspension requiring the submission of the legal basis for the full implementation of the new salary schedule. And thus, COA resident auditor issued a notice of disallowance. COA sustained the decision made by the resident auditor. NEA argues that it may accelerate the implementation of the salary increases due to the availability of funds.

Issues: Whether or not the budgetary appropriations of the National Electrification Administration under the General Appropriations Act of 1997 constitute unbridled authority to government agencies to spend the appropriated amounts as they may wish.

Held: Budgetary appropriations under the General Appropriations Act of 1997 (GAA) do not constitute unbridled authority to governmentagencies to spend the appropriated amounts as they may wish. Section 60, Chapter 7, Book VI of the Administrative Code provides that no portion of the appropriations in the GAA shall be used for payment of any salary increase or adjustment unless specifically authorized by law or appropriate budget circular Section 33 of the 1997 GAA itself expressly provides that the salary increase authorized by the Senate-HR Joint Resolution or the salary standardization law are subject to the approval by the President Section 10 of EO 289 does not authorize, expressly or impliedly, the advance implementation of the salary increases just because the GOCC has the available funds.

Added, “under our system of government all executive departments, bureaus and offices are under the control of the President of the Philippines. This precept is embodied in Article VII, Section 17 of the Constitution which provides as follows:

“Sec. 17. The President shall have control of all the executive departments, bureaus and offices. He shall ensure that the laws be faithfully executed.”

The presidential power of control over the executive branch of government extends to all executive employees from Cabinet Secretary to the lowliest clerk.(18) The constitutional vesture of this power in the President is self-executing and does not require statutory implementation, nor may its exercise be limited, much less withdrawn, by the legislature.”