05/12/2025
G.R. No. 274778, Aquilino Pimentel III et al. v. House of Representatives et al.
G.R. No. 275405, Bayan Muna Chairman Neri Colmenares et al. v. Executive Secretary Lucas P. Bersamin et al.
G.R. No. 276233, 1Sambayan Coalition et al. v. House of Representatives et al.
The , during its session on December 3, 2025, unanimously ordered the return of PhilHealth funds previously transferred to the National Treasury in the amount of PHP 60 billion and permanently prohibited the transfer of the remaining PHP 29.9 billion fund balance.
In a Decision penned by Associate Justice Amy C. Lazaro-Javier, the Court En Banc, by a majority vote, also declared void Special Provision 1(d), Chapter XLIII of the 2024 General Appropriations Act (2024 GAA), and Department of Finance (DOF) Circular No. 003-2024 for having been issued and implemented with grave abuse of discretion amounting to lack or excess of jurisdiction.
Special Provision 1(d) authorized the return of the fund balance or the excess reserve funds of government-owned or controlled corporations (GOCCs) to the National Treasury to fund unprogrammed appropriations under the 2024 GAA.
The DOF issued Circular No. 003-2024, directing the transfer of PHP 89.8 billion to the National Treasury, representing the fund balance or excess reserve funds of the PhilHealth. In compliance, the PhilHealth remitted PHP 60 billion to the National Treasury in three tranches.
The SC issued a temporary restraining order (TRO) against the transfer of the remaining PHP 29.9 billion PhilHealth funds and the further implementation of Special Provision 1(d) of the 2024 GAA and DOF Circular No. 003-2024.
The SC struck down Special Provision 1(d) of the 2024 GAA for being a rider—a provision not germane or related to the bill’s purpose. The Constitution requires all provisions of the GAA to be germane to its purpose to prevent surprise or fraud upon the legislature and to fairly inform the people of the bills’ subject.
While Special Provision 1(d) is particular in that it relates to the unprogrammed appropriations in the GAA, the Court found the provision ambiguous because it introduced the concept of a “fund balance”—a term not defined in the 2024 GAA.
The SC also ruled that Special Provision (1)d is unconstitutional because it impliedly repeals Section 11 of the Universal Health Care Act (UHCA) and the Sin Tax Laws.
The SC ruled that reallocating PhilHealth’s supposed “excess reserve funds” through Special Provision 1(d) and DOF Circular No. 003-2024 makes compliance with Section 11 impossible as they undermine the very nature of PhilHealth funds as pooled resources for social health insurance, among others.
The SC stressed that Congress cannot repeal Section 11 through the General Appropriations Act.
The SC further found that Special Provision 1(d) contradicts the Sin Tax Laws, which earmark specific percentages of excise taxes on sweetened beverages, alcohol, and to***co products exclusively for the UHCA.
The SC also ruled that the Finance Secretary cannot, in any capacity, augment any item in the GAA because this power belongs to the President.
The SC also ruled that the President did not commit grave abuse of discretion when he certified as urgent House Bill No. 8980, now the 2024 GAA, which dispensed with the requirement of reading on three separate days and the printing and distribution of copies in advance.
The SC also denied the petitioners’ request to determine the liability of the DOF Secretary for technical malversation and/or plunder, ruling that such matters are improper for resolution in this case. The only issue properly before it is the validity of the issuances and whether they were issued with grave abuse of discretion amounting to a lack or excess of jurisdiction. The Justices who submitted their respective separate opinions also noted that no criminal liability can attach to the Finance Secretary, who they found to have acted in good faith in implementing Special Provision 1(d).
The SC ordered that the remitted funds amounting to PHP 60 billion be returned to PhilHealth through the 2026 GAA.
Separate Opinions
Senior Associate Justice Marvic M.V.F. Leonen held that the presidential declaration of urgency should be considered invalid, noting that no emergency or public calamity justified dispensing with the constitutional requirement of three readings on separate days.
Associate Justice Alfredo Benjamin S. Caguioa emphasized that Congress exceeded its authority when it increased the unprogrammed appropriations proposed by the President, describing the move as a deliberate attempt to circumvent the constitutional prohibition against increasing the President’s proposed appropriations.
Associate Justice Ramon Paul L. Hernando held that unprogrammed appropriations in the GAA are unconstitutional and that the entire amount should be removed.
Associate Justice Henri Jean Paul B. Inting stated that the President’s certification of the bill as urgent was based on a reasonable assessment of the country’s needs and not an act of grave abuse of discretion.
Associate Justice Rodil V. Zalameda expressed reservation on the wholesale invalidation of Special Provision No. 1 (d) and DOF Circular No. 003-2024, saying that while he agreed that the transfer was unconstitutional, he held that the government may nonetheless be considered to have acted in good faith.
Associate Justice Samuel H. Gaerlan held that declaring the issuances invalid does not negate the good faith of the Finance Secretary in implementing Special Provision No. 1 (d) through DOF Circular No. 003-2024, nor does it automatically create a basis for his liability.
Associate Justice Ricardo R. Rosario emphasized that a finding of grave abuse of discretion by a public official does not equate to criminal liability.
Associate Justice Jhosep Y. Lopez disagreed with striking down Special Provision No. 1 (d) and DOF Circular No. 003-2024 in their entirety, asserting that the ruling should be limited solely to the transfer of PhilHealth funds.
Associate Justice Japar B. Dimaampao held that the wholesale invalidation of Special Provision No. 1 (d) and DOF Circular No. 003-2024 should be avoided as these can be reconciled with the UHCA and the Sin Tax Laws.
Associate Justice Jose Midas P. Marquez likewise disagreed with the broad invalidation of the issuances. He held that Special Provision No. 1 (d) enjoys the presumption of constitutionality and should be harmonized with the Constitution.
Associate Justice Maria Filomena D. Singh noted that the transfer diverted funds intended for indigents, senior citizens, and persons with disabilities, weakening PhilHealth’s capacity to provide universal healthcare and marginalized Filipinos of essential support.
Associate Justice Raul B. Villanueva disagreed with declaring Special Provision No. 1 (d) unconstitutional, arguing that it did not directly repeal the UHCA and Sin Tax Laws. He added that Special Provision No. 1 (d) should be applied to GOCCs whose charters do not prohibit such transfer of funds.
Read the full text of the press release at https://sc.judiciary.gov.ph/?p=156834
Read the full text of the Decision at https://sc.judiciary.gov.ph/?p=156755
Read the Separate Opinion of Senior Associate Justice Marvic M.V.F. Leonen at https://sc.judiciary.gov.ph/?p=156760
Read the Concurring Opinion of Associate Justice Alfredo Benjamin S. Caguioa at https://sc.judiciary.gov.ph/?p=156766
Read the Separate Concurring and Dissenting Opinion of Associate Justice Ramon Paul L. Hernando at https://sc.judiciary.gov.ph/?p=156771
Read the Separate Concurring Opinion of Associate Justice Henri Jean Paul B. Inting at https://sc.judiciary.gov.ph/?p=156776
Read the Separate Concurring Opinion of Associate Justice Rodil V. Zalameda at https://sc.judiciary.gov.ph/?p=156781
Read the Separate Concurring Opinion of Associate Justice Samuel H. Gaerlan at https://sc.judiciary.gov.ph/?p=156786
Read the Concurring Opinion of Associate Justice Ricardo R. Rosario at https://sc.judiciary.gov.ph/?p=156792
Read the Separate Concurring Opinion of Associate Justice Jhosep Y. Lopez at https://sc.judiciary.gov.ph/?p=156797
Read the Separate Opinion of Associate Justice Japar B. Dimaampao at https://sc.judiciary.gov.ph/?p=156802
Read the Separate Opinion of Associate Justice Jose Midas P. Marquez at https://sc.judiciary.gov.ph/?p=156807
Read the Separate Concurring Opinion of Associate Justice Maria Filomena D. Singh at https://sc.judiciary.gov.ph/?p=156812
Read the Separate Opinion of Associate Justice Raul B. Villanueva at https://sc.judiciary.gov.ph/?p=156820
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