GMA URGED TO CITE LEGAL BASIS FOR CASH SUBSIDY FOR SMALL POWER USERS

Senate Minority Leader Aquilino Q. Pimentel, Jr. (PDP-Laban) today asked President Gloria Macapagal-Arroyo to provide a legal justification for the cash subsidy the government is giving to so-called lifeline users of power in the light of allegations that it violates the constitutional provision that no public funds can be spent without congressional approval.

Pimentel said that while the P500 state subsidy being granted to power users consuming 100 kilowatt hours or less a month may help ease their financial burden, this does not exempt the Chief Executive from the constitutional rule that all public expenditures should have the prior approval of Congress in the exercise of its power over the purse.

"Of course, the people, in times of financial difficulties, may be happy for receiving the cash dole out. But the President should be reminded that she cannot play Robinhood and disburse public funds just like that without complying with the requirements of the Constitution and appropriation laws," he said.

Earlier, UP public administration professor and former National Treasurer Leonor Briones branded the President's directive to earmark P2 billion subsidy for small power users as illegal on the ground that it supposedly not covered by any appropriations law. The amount reportedly came from the government's windfall earnings in the form of additional Value Added Tax collections from oil resulting from the steep increase in the prices of petroleum products.

Briones warned that the President may be liable for impeachment if she is found to have culpably violated the constitutional provision that all disbursements of government should be covered by, and in pursuant of, appropriation laws.

Pimentel advised the President not to take for granted the power of Congress to appropriate funds since what she is spending is not her personal money and she is not above the law.

"She cannot ignore Congress like that or else she has to face the consequences of her unlawful act. Many people may have felt lucky over the financial aid and the President may be getting 'pogi' points for the subsidy. But as we have said, the President has no right to disburse, much less to dole out, to taxpayers' money without the permission of Congress," he said.

The minority leader also said the procedures for handing out the P500 cash subsidy is flawed. Intended beneficiaries get the money from designated branches of the Land Bank of the Philippines by showing their power bills of Meralco or electric cooperatives. But there is no way to ensure that they use it for paying their power bills. In fact, they can spend the amount for anything else, including liquor, cigarette or illegal drug in the absence of any clear-cut guidelines.

Pimentel said if the President is really sincere in easing the financial burden of the poor, the better and more practical approach is to suspend or scrap altogether the 12 percent VAT on the monthly power bills of residential users and the additional 12 percent VAT on the system losses that are being charged against them.

He criticized Malacañang for its persistent objection to the bill in Congress to lift the VAT on power even if temporarily. He argued that since fuel like diesel and natural gas that is used by power plants is already subjected to the 12 percent VAT, the power generated and sold to consumers should no longer be levied the same tax.