Professional Documents
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ISSUES
ARTICLES/LAWS INVOLVED
SECTION 20. The President may contract or guarantee
foreign loans on behalf of the Republic of the Philippines
with the prior concurrence of the Monetary Board, and
subject to such limitations as may be provided by law. The
Monetary Board shall, within thirty days from the end of
every quarter of the calendar year, submit to the Congress
a complete report of its decisions on applications for loans
to be contracted or guaranteed by the Government or
government-owned and controlled corporations which
would have the effect of increasing the foreign debt, and
containing other matters as may be provided by law.
HELD
Sec. 1. In order to meet public expenditures authorized by law or to provide for the purchase,
redemption, or refunding of any obligations, either direct or guaranteed of the Philippine Government,
the Secretary of Finance, with the approval of the President of the Philippines, after
consultation with the Monetary Board, is authorized to borrow from time to time on the
credit of the Republic of the Philippines such sum or sums as in his judgment may be
necessary, and to issue therefor evidences of indebtedness of the Philippine
Government."
Such evidences of indebtedness may be of the following types:
....
c. Treasury bonds, notes, securities or other evidences of indebtedness having maturities of
one year or more but not exceeding twenty-five years from the date of issue. (Emphasis
supplied.)
Under the foregoing provisions, sovereign bonds may be issued not only to supplement government
expenditures but also to provide for the purchase, redemption, or refunding, of any obligation, either direct or
guaranteed, of the Philippine Government.
Buy-Back Scheme
-It is true that in the balance of power between the three branches of government, it is Congress that manages
the countrys coffers by virtue of its taxing and spending powers. However, the law-making authority has
promulgated a law ordaining an automatic appropriations provision for debt servicing by virtue of which the
President is empowered to execute debt payments without the need for further appropriations. Regarding these
legislative enactments, this Court has held.
- It is true that in the balance of power between the three branches of government, it is Congress that manages
the countrys coffers by virtue of its taxing and spending powers. However, the law-making authority has
promulgated a law ordaining an automatic appropriations provision for debt servicing by virtue of which the
President is empowered to execute debt payments without the need for further appropriations. Regarding these
legislative enactments, this Court has held,
2nd issue delegation of power
Ratio/Doctrineon Delegation of power
Based on the Doctrine of Qualified Political Agency. Each head of thedepartment is and must be, the Presidents
alter ego in the matters of that department where the President is required by law to exercise authority.