G.R. No. 208566, November 19, 2013, BELGICA vs.
EXECUTIVE become a common exercise of unscrupulous Members of Congress,"
SECRETARY
Facts:
"Pork Barrel" refers to an appropriation of government spending
meant for localized projects and secured solely or primarily to bring
money to a representative's district. The present cases and the recent
controversies on the matter have, however, shown that the term‘s
usage has expanded to include certain funds of the President such as
the Malampaya Funds and the Presidential Social Fund.
The Malampaya Funds was created as a special fund under Section
8 of Presidential Decree No. (PD) 910, issued by then President
Ferdinand E. Marcos (Marcos) on March 22, 1976. In enacting the said
law, Marcos recognized the need to set up a special fund to help
intensify, strengthen, and consolidate government efforts relating to
the exploration, exploitation, and development of indigenous energy
resources vital to economic growth.
On the other hand the Presidential Social Fund was created under
Section 12, Title IV of PD 1869, or the Charter of the Philippine
Amusement and Gaming Corporation (PAGCOR). As it stands, after
some amendments to the original statute, the Presidential Social Fund
has been described as a special funding facility managed and
administered by the Presidential Management Staff through which the
President provides direct assistance to priority programs and projects
not funded under the regular budget. It is sourced from the share of the
government in the aggregate gross earnings of PAGCOR.
Over the decades, "pork" funds in the Philippines have increased
tremendously. In 2004, several concerned citizens sought the
nullification of the PDAF as enacted in the 2004 GAA for being
unconstitutional. Unfortunately, for lack of "any pertinent evidentiary
support that illegal misuse of PDAF in the form of kickbacks has
the petition was dismissed.
In July 2013, the NBI began its probe into allegations that "the
government has been defrauded of some ₱10 Billion over the past 10
years by a syndicate using funds from the pork barrel of lawmakers
and various government agencies for scores of ghost projects." The
investigation was spawned by sworn affidavits of six (6) whistle-
blowers who declared that JLN Corporation – "JLN" standing for
Janet Lim Napoles (Napoles) – had swindled billions of pesos from
the public coffers for "ghost projects" using no fewer than 20 dummy
NGOs for an entire decade. While the NGOs were supposedly the
ultimate recipients of PDAF funds, the whistle-blowers declared that
the money was diverted into Napoles‘ private accounts.
On August 16, 2013, the Commission on Audit (CoA) released the
results of a three-year audit investigation covering the use of
legislators' PDAF from 2007 to 2009, or during the last three (3) years
of the Arroyo administration which revealed irregularities in use of the
funds.
Spurred in large part by the findings contained in the CoA Report and
the Napoles controversy, several petitions were lodged before the
Court similarly seeking that the "Pork Barrel System" be declared
unconstitutional.
Among others, petitioners contend that Section 8 of PD 910 constitutes
an undue delegation of legislative power since the phrase "and for such
other purposes as may be hereafter directed by the President" gives the
President "unbridled discretion to determine for what purpose the
funds will be used." Respondents, on the other hand, urged the Court
to apply the principle of ejusdem generis to the same section and thus,
construe the phrase "and for such other purposes as may be hereafter
directed by the President" to refer only to other purposes related "to
energy resource development and exploitation programs and projects
of the government."

Issue:
Whether or not the phrases (a) "and for such other purposes as may be
hereafter directed by the President" under Section 8 of PD 910,
relating to the Malampaya Funds, and (b) "to finance the priority
infrastructure development projects and to finance the restoration of
damaged or destroyed facilities due to calamities, as may be directed
and authorized by the Office of the President of the Philippines" under
Section 12 of PD 1869, as amended by PD 1993, relating to the
Presidential Social Fund, are unconstitutional insofar as they
constitute undue delegations of legislative power.
Ruling:
Yes, the phrase "and for such other purposes as may be hereafter
directed by the President" under Section 8 of PD 910 constitutes an
undue delegation of legislative power insofar as it does not lay down
a sufficient standard to adequately determine the limits of the
President‘s authority with respect to the purpose for which the
Malampaya Funds may be used. As it reads, the said phrase gives the
President wide latitude to use the Malampaya Funds for any other
purpose he may direct and, in effect, allows him to unilaterally
appropriate public funds beyond the purview of the law. That the
subject phrase may be confined only to "energy resource development
and exploitation programs and projects of the government" under the
principle of ejusdem generis, meaning that the general word or phrase
is to be construed to include – or be restricted to – things akin to,
resembling, or of the same kind or class as those specifically
mentioned, is belied by three (3) reasons: first, the phrase "energy
resource development and exploitation programs and projects of the
government" states a singular and general class and hence, cannot be
treated as a statutory reference of specific things from which the
general phrase "for such other purposes" may be limited; second, the
said phrase also exhausts the class it represents, namely energy
development programs of the government; and, third, the Executive
department has, in fact, used the Malampaya Funds for non-energy
related purposes under the subject phrase, thereby contradicting
respondents‘ own position that it is limited only to "energy resource
development and exploitation programs and projects of the
government." Thus, while Section 8 of PD 910 may have passed the
completeness test since the policy of energy development is clearly
deducible from its text, the phrase "and for such other purposes as may
be hereafter directed by the President" under the same provision of law
should nonetheless be stricken down as unconstitutional as it lies
independently unfettered by any sufficient standard of the delegating
law.
As for the Presidential Social Fund, the Court takes judicial notice of
the fact that Section 12 of PD 1869 has already been amended by PD
1993 which thus moots the parties‘submissions on the
same. Nevertheless, since the amendatory provision may be readily
examined under the current parameters of discussion, the Court
proceeds to resolve its constitutionality.
Primarily, Section 12 of PD 1869, as amended by PD 1993, indicates
that the Presidential Social Fund may be used "to first, finance the
priority infrastructure development projects and second, to finance the
restoration of damaged or destroyed facilities due to calamities, as may
be directed and authorized by the Office of the President of the
Philippines." The Court finds that while the second indicated purpose
adequately curtails the authority of the President to spend the
Presidential Social Fund only for restoration purposes which arise
from calamities, the first indicated purpose, however, gives him carte
blanche authority to use the same fund for any infrastructure project
he may so determine as a "priority". Verily, the law does not supply a
definition of "priority in frastructure development projects" and hence,
leaves the President without any guideline to construe the same. To
note, the delimitation of a project as one of "infrastructure" is too
broad of a classification since the said term could pertain to any kind
of facility. This may be deduced from its lexicographic definition as
follows: "the underlying framework of a system, especially public
services and facilities (such as highways, schools, bridges, sewers, and
water-systems) needed to support commerce as well as economic and
residential development." In fine, the phrase "to finance the priority
infrastructure development projects" must be stricken down as
unconstitutional since – similar to the above-assailed provision under
Section 8 of PD 910 – it lies independently unfettered by any sufficient
standard of the delegating law. As they are severable, all other
provisions of Section 12 of PD 1869, as amended by PD 1993, remains
legally effective and subsisting.

Note: There are two (2) fundamental tests to ensure that the legislative
guidelines for delegated rule-making are indeed adequate. The first
test is called the "completeness test." Case law states that a law is
complete when it sets forth therein the policy to be executed, carried
out, or implemented by the delegate. On the other hand, the second
test is called the "sufficient standard test." Jurisprudence holds that a
law lays down a sufficient standard when it provides adequate
guidelines or limitations in the law to map out the boundaries of the
delegate‘s authority and prevent the delegation from running riot. To
be sufficient, the standard must specify the limits of the delegate‘s
authority, announce the legislative policy, and identify the conditions
under which it is to be implemented.