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Daphne Galvez - The Philippine Star
February 27, 2025 | 12:00am
MANILA, Philippines — Supreme Court (SC) Associate Justice Amy Lazaro-Javier has questioned the government’s transfer of unutilized funds of the Philippine Health Insurance Corp. (PhilHealth) to the national treasury to finance projects already fully funded in the 2024 budget, including those not related to health care.
Lazaro-Javier raised the questions during the resumption of oral arguments on the controversial P89.9-billion PhilHealth fund transfer to the national treasury to fund unprogrammed appropriations in the 2024 national budget.
Citing the Department of Finance (DOF), she said the funds remitted to the national treasury were meant to fund “urgent” national projects, and among those identified as such were routine maintenance of national roads and the Panay-Guimaras-Negros (PGN) Island bridges project.
However, Lazaro-Javier pointed out that the PGN project already received full funding from the Export-Import Bank of Korea, amounting to P174.49 billion, as well as additional allocations from the 2022 and 2023 national budgets.
“Is there an urgency to transfer the PhilHealth funds when the project is already fully funded?” she asked Solicitor General Menardo Guevarra, who represented the respondents, the House of Representatives and the Senate.
In response, Guevarra said Congress factors in whether a project can already be implemented in the given fiscal year.
“If a project that has already been identified and sufficiently funded is considered to be non-implementable for the given fiscal year, I think it is the decision of Congress in the exercise of its policy or wisdom, so to speak, to move it to the unprogrammed appropriations in the meantime,” he explained.
Lazaro-Javier then asked Guevarra if the government had already spent any of the funds from the Korean loan for the PGN project, to which Guevarra said:
“There is nothing to spend for if the project has not even started.”
“So where is the money?” Lazaro-Javier asked.
Guevarra presumed that the money went to the national treasury for use in unprogrammed projects, which are not clearly outlined in the budget.
On the issue of road maintenance funds, Guevarra admitted that the government did not specify which roads would be repaired using the unprogrammed funds, saying the decision is left to the implementing agency.
Lazaro-Javier also raised that the 2024 General Appropriations Act (GAA) already allocated a P459-million budget under the Office of the Presidential Adviser on Peace, Reconciliation, and Unity for the management and supervision of a comprehensive peace process.
However, an additional P688 million was placed under unprogrammed appropriations for this purpose.
“Is the peace process part of the mandate of PhilHealth?” the SC associate justice said.
Guevarra declined to speculate on why lawmakers allocated the project under unprogrammed funds, but said the inclusion of such projects in the unprogrammed appropriations was merely a list and the actual use of funds would still depend on the implementing agencies.
PhilHealth funds must be for PhilHealth
Citing the Universal Health Care Act, Lazaro-Javier said funds appropriated for PhilHealth should be exclusively used for PhilHealth purposes” and “not for the operations of any other department of government.”
She also noted that the national government subsidy, identified as a source of appropriations for PhilHealth, is meant to specifically benefit indirect contributors, such as senior citizens and indigents.
Guevarra however assured the SC that most of the P60 billion excess funds remitted by PhilHealth to the national treasury were allocated to critical health and social service programs.
During the second round of oral arguments Guevarra said that the 2024 GAA directed the use of these funds for social and health-related projects.
“And as a matter of fact, as of December of 2024, the total amount of P46 billion pesos, thereabouts, more or less, had been devoted under the unprogrammed appropriations for social— more particularly, health projects,” he said.
PhilHealth’s remittance followed the implementation of Special Provision 1(d) of the 2024 GAA, which permits the utilization of government-owned and controlled corporations’ excess funds for priority programs in health, social services and infrastructure.
The DOF executed the provision by issuing DOF Circular 003-2024, ensuring the proper allocation of the funds.
Based on DOF data, P46.61 billion out of the P60 billion was funneled into key health and social service initiatives.
A significant portion, amounting to P27.45 billion, was used to pay the long-overdue public health emergency benefits and allowances for health care and non-health care workers who served during the COVID-19 pandemic.
Another P10 billion was allocated for medical assistance to indigent and financially incapacitated patients, while P4.10 billion was used to procure medical equipment for Department of Health hospitals, local government unit hospitals as well as primary care facilities.
Further, P3.37 billion was spent on the construction of three new DOH health facilities and P1.69 billion was allocated to the health facilities enhancement program.
The remaining P13 billion was utilized for government counterpart financing of infrastructure projects designed to improve social determinants of health, such as food security and health care accessibility in remote areas.
Guevarra also noted that PhilHealth’s financial standing remained strong despite the remittance, allowing it to expand its benefit packages.
The Supreme Court is set to resume oral arguments on the case on March 4. — Keisha Ta-Asan
