Case Summary (G.R. No. 169637)
Key Dates
- The COA disallowed the allowances on October 20, 1999, under Notice of Disallowance No. 99-001-STF (98).
- COA-CAR Decision No. 2000-3 affirmed this disallowance on January 26, 2000.
- COA Decision No. 2003-112, which affirmed the initial disallowance, was issued on July 17, 2003.
- The motion for reconsideration of this decision was denied in COA Decision No. 2005-019 dated March 17, 2005.
Applicable Law
The legal basis for the decisions stems from the 1987 Philippine Constitution, specifically Article IX-B, which prohibits additional, double, or indirect compensation for public officers and employees unless explicitly authorized by law. The contention also involves Republic Act No. 8292, the Higher Education Modernization Act of 1997, and the Salary Standardization Law (R.A. No. 6758).
Case Background
Pursuant to R.A. No. 8292, which governs the fiscal autonomy of state universities and colleges, BSU's Board of Regents issued Resolution No. 794 on October 31, 1997, to grant rice subsidies and health care allowances to employees with the funds derived from BSU’s operations. Auditors later disallowed these allowances, concluding that R.A. No. 8292 does not authorize such benefits.
COA's Rationale
In affirming the disallowance, COA held that allowances granted to employees must have a statutory basis as stipulated in Section 8 of Article IX-B of the 1987 Constitution. The court emphasized that the interpretation of Section 4 (d) of R.A. No. 8292 and its implementing rules required the allowances to be related to instruction, research, or extension activities of the university. They found that rice subsidies and health care allowances did not fall under these categories.
Legal Arguments
BSU argued that under the statutory framework, it had the authority to grant additional benefits to its employees as recognition for their service. It claimed that these benefits address the economic difficulties faced by its workforce and do not contravene the prohibition of additional compensation since they are seen as incentives rather than salary increases. COA rejected this argument, pointing out that the allowances were not specifically authorized by law, and thus considered illegal under the salary standardization provisions.
Review of the Petition
BSU filed a petition for review, which is not the correct procedure for appeals from COA decisions, as the Supreme Court indicated that such cases should be under Rule 65 of the Rules of Civil Procedure. However, the Supreme Court accepted BSU's allegations of grave abuse of discretion as sufficient to treat the petition under the appropriate procedural rule.
Supreme Court’s Finding
The Supreme Court upheld the decisions of the COA, confirming that BSU could not lawfully provide the rice subsidy and health care benefits. It reinforced the interpretation that the Governing Board's powers are not absolute and are limited by existing laws. Additionally, it aligned with the principle that the phrase "other programs/projects" must relate di
...continue readingCase Syllabus (G.R. No. 169637)
Overview of the Case
- The case centers on a petition for review on certiorari filed by Benguet State University (BSU) against the Commission on Audit (COA).
- The petition seeks to nullify COA Decision No. 2003-112 and Decision No. 2005-019, which disallowed the grant of rice subsidy and health care allowance to BSU employees.
- COA Decision No. 2003-112 affirmed a prior decision that deemed these allowances unauthorized, while Decision No. 2005-019 denied BSU's motion for reconsideration.
Legal Background
- On July 6, 1997, Republic Act No. 8292, known as the Higher Education Modernization Act of 1997, was enacted.
- This law allowed the Board of Regents of BSU to disburse income generated from operations for certain purposes.
- BSU's Board of Regents passed Board Resolution No. 794 on October 31, 1997, granting rice subsidy and health care allowances to employees, which were later disallowed by the COA.
Audit Disallowance and COA Decisions
- The initial disallowance was issued under Notice of Disallowance No. 99-001-STF (98) on October 20, 1999, citing lack of statutory authority under R.A. No. 8292.
- COA-CAR Decision No. 2000-3 affirmed this disallowance, arguing that the allowances lacked a statutory basis and violated the constitutional prohibition on additional compensation.
- BSU's appeals to COA regarding these decisions were unsuccessful, leading to the current petition.
Issues Presented
- The primary issues raised by BSU are: A. Whether BSU is authorized to grant health care allowances and rice subsidies to its employees. B. Whether employees should reimbur