Republic af the Philipines DEPARTMENT OF THE INTERIOR AND LOCAL GOVERNMENT DILG-NAPOLCOM Building, EDSA corn “paver dl gov. ph OFFICE OF THE UNDERSECRETARY Fi HON, PEPITOT, BASANGAN "+ Sangguniang Panlungsod Member" Tarlac City, Province of Tarlac Dear SP Member Basangat This refers to your 25 March 2015 letter requesting, following issues: (Quezon Avenue, Quezon City IR LOCAL GOVERNMENT DILG Legal Opinion No. 30, S. 2015 22 JUL 2015 his Department's legal opinion on the ul i | | | “1, Whether or not the withholding by the'local chief executive of the salaries (sic) personnel (permanent, casual or job order) despite the existence of a re-enacted buaget is valid; > Whether or not the withholding by the compensation such as allowances and RATA budget is valid; and, 7 3. Whether or not the withholding by the local 4 allowances of the personnel (under a re-enact or authorization of their transfer or the rec valid.” - The City of Tarlac is currently operating under a authorization of their budget. SP Member Basangan alleges that the City Mayor local chief executive of other of personnel under a re-enacted Inief executive of the salaries and 11 budget), pending the approval lassificntion of their position, is re-enacted budget pending legislative as not been releasing the salaries and ‘wages of employees of the City Government and was claiming that the delayed approval of their budget is affecting the delivery of services an| the latter is requesting for the SP's immediate appr release of salaries and wages. Hence, val of the proposed FY 2015 budget of the City to ensure the implementatidn of various uygent projects, as well as to facilitate the release of the salaries and allowances of ninety-nine (99) City Economic Enterprise Management Office (CEEMO) employees who ar allegedly affected by the delay in theapproval of their budg. in addition, the City Maypor hasa pend, _, request with the SP for the transfer/reclassification/abolishment of permnent positions under the CEEMO to various departments, which has not been acted upon by the SP due to lack of supporting documents, Upon the $P’s consultation with DBM Region 3, the latter allegedly advised that the non- payment or withholding of allowances under a }e-enacted budget is solely within the discretion of the local chief executive there being no specific set of rules or guidelines governing the same. Hence this request. 3 This Department has no authority to rule on the vplidity local chief executive's acts as the same enjoys the presumption of validity and may only be assailed in a proper proceeding before the proper authority. Hence, the discussion|shall focus on generalities. " | fects of Re-enacted Budget | Section 323 ofthe Local Government Code (hereinafter, the “Code") provides that only the annual appropriations for salaries and wages of existing positions, statutory and contractual obligations, and essential operating expenses authorized in the annual and supplemental budgets for the preceding year shall be deemed re-Hnacted and disbursement of funds shall be in accordance therewith, viz: “Section 323, Failure to Enact the Anjaual Appropriations. ~ In case the sanggunian concerned fails to pass the oflinance authorizing the annual "appropriations at the beginning of the ensuing fiscal year, it shall continue to hold sessions, without additional remuneration for its members, until such ordinance is approved, and no other busineks may be taken up during such sessions. If the sanggunian still fails to enact such ordinance afier ninety (90) days from the beginning of the fiscal yeay, the ordinance authorizing the ‘appropriations of the'precedling year shall be deemed reenacted and shall remain in force and effect until the ordinance authorizing the proposed appropriations is passed by the sanggunian Yoncerned. However, only the annual appropriations for salaries ‘and wages of existing positions, statutory and coutractual obligations, aud essential operdting expenses authorized in the unuuil aut supplemental budgets for the preceding year shall be deemed enacted and disbursement of funds shall be in accordance therewith, In the implementation of such reenacted ordinance, the local treasurer concerned shall exclude from the estimates of income for the preceding fiscal year those realized from nonrecurring sourced, like national aids, proceeds from loans, sale of assets, prior year adjustments] and other analogous sources of inncome, No ordinance authorizing supplemerttal appropriations shall be passed in place of the annual appropriations. a Page Dota 1LG OpinionIn case the revised income estimates be less than the aggregate reenacted appropriations, the local treasurer congerned shall accordingly advise the sanggunian concerned which shall, within ten (10) days from the receipt of such advice, make the necessary adjustnipnts or reductions. ‘The revised appropriations authorized by the sarggtatian concerned shall then be the basis for dishursements.” [Underscoring supplied] Consequently, a re-enacted budget will have implied disadvantages, as enumerated in the DBM’s Budget Operations Manual (BOM) fdr Local Government Units (An Updated Version of the June 2005 Edition), such as, but hot limited to, the following: 1. No creation of positions; . 2. No new programs, projects and activities; 3. No utilization of the increase in TRA allocation for the year since the same is not covered by an Appropriation Ordinance} 4. Non-implementation of non-recurring activities no matter how vital they may be; 5, No supplemental appropriations. ] | | | Salaries of Permanent, Casual & Job Orders ‘The salaries of personne! holding permanent! and casual? appointments are covered under the re-enacted budget as they are considered existing positions in the government service. Job Orders, on the other hand, covers piece of work or intermittent job of short duration not exceeding six months on a daily basis and are not considered government service but are in the nature of contracts which is under the supervision and regulation by the DBM and the COA pursuant to Section 1, Rule |XI of Civil Service Commission (CSC) Memorandum Circular (MC).No. 40, s. 1998, af amended, and CSC MC No. 1, s. 2007, Hence, the samé may be covered, undér the repnacted’ budget provided said contractual obligation was authorized in the annual and supplemental budget for the preceding year +1, Permanent — one issued to person who hay met the requirements of the position to which appointment is made, in accordance with the provisions df the Civil Service Act and the Rules and Standards Promulgated in pursuance thereof; (Sec. 25, a and b, P.D. No. 807; see also CSC Memorandum Circular No. 11, S.of 1991, 5 April 1991.) . “Casual employees are classified uncer the non-career service, which is characterized by the following: (2) entrance on bases other than those usual tests of merit and}ftness utilized for the career service; and (2) tenure whichis limited to a period specified by law, or which is cqterminous with that of the appointing authority or subject to his pleasure, hislimited to the duration of a particular project for which purpose employment was made. (Lydia 0. Chua vs. The Civil Service Commission (.R. No, 88979.Febr vary 7, 1992) Page ota ‘ ‘1G OpinionAllowances and RATA | ‘The matter being within the administrative expertise of the Department of Budget and ‘Management (DBM), this Department deems it proper to refer the same for an authoritative interpretation of said agency. (Please see attached copy of letter to the DBM) | Anent the 3" query, this Department shall defer from rendering an opinion thereon due to insufficiency of facts. However, please be guided by the discussions relative to the salaries of permanent, casual and job orders vis-d-vis the limitations of a reenacted budget under Section 323 of the Code. *, | We hope to have enlightened you on the matter. | | Very truly yours, /) ( enh AUSTERE A. PANADERO Undersecretary yes 1G sera | ce ‘FLORA W.DUAN ote Ragen Regina Goverment Cntr fargay Mame, San Fernand, Pangarga t Soy Page tot DG Gpinon t