The President's item-veto power extends to "inappropriate provisions" in an appropriations bill that are essentially general law measures and do not relate specifically to a particular appropriation, and such provisions can be treated as "items" for the purpose of the veto.

The controversy arose from the President's exercise of the veto power over specific provisions in the General Appropriations Acts for Fiscal Years 1989 and 1990. Congress, in these acts, included provisions (Section 55 for FY 1989 and Section 16 for FY 1990) that aimed to prohibit the President and other designated officials from using savings to augment items of appropriation that Congress had disapproved or reduced from the President's original budget proposal. The President vetoed these provisions, citing them as unconstitutional infringements on the executive's power of augmentation and as violations of the constitutional provision allowing augmentation from savings.

• On December 16, 1988, Congress passed House Bill No. 19186, the General Appropriations Bill for Fiscal Year 1989, which eliminated or decreased certain items from the President's proposed budget.
• On December 29, 1988, the President signed the bill into law as Republic Act No. 6688, but vetoed seven Special Provisions and Section 55, a General Provision.
• Section 55 of the FY 1989 General Appropriations Act (GAA) prohibited the restoration or increase of recommended appropriations disapproved or reduced by Congress through the use of augmentation from savings.
• On February 2, 1989, the Senate adopted Resolution No. 381, expressing its sense that the President's veto of Section 55 was unconstitutional and authorizing the Senate Committee on Finance to file a suit with the Supreme Court.
• Subsequently, a similar provision, Section 16, was included in the General Appropriations Bill for Fiscal Year 1990 (House Bill 26934, which became Rep. Act No. 6831). This section combined the "Use of Savings" clause with a proviso identical in substance to the vetoed Section 55 of the FY 1989 GAA.
• The President also vetoed the proviso in Section 16 of the FY 1990 GAA for similar reasons, primarily that it violated Article VI, Section 25(5) of the Constitution regarding the power to augment appropriations.
• Petitioners, members of the Senate Committee on Finance and taxpayers, filed a petition for Prohibition/Mandamus challenging the constitutionality of the presidential veto of Section 55 (FY '89) and later, through a supplemental petition, the veto of Section 16 (FY '90).

• The President's line-veto power for appropriation bills is limited to "items" and does not cover "provisions"; therefore, the President exceeded her authority by vetoing Section 55 (FY ‘89) and Section 16 (FY ‘90), which are provisions.
• When the President objects to a provision of an appropriation bill, she cannot exercise the item-veto power but must veto the entire bill.
• The item-veto power does not include the power to strike out conditions or restrictions, as this would constitute legislation by the President, violating the separation of powers.
• The power of augmentation under Article VI, Section 25(5) of the Constitution must be provided for by law, meaning Congress has the prerogative to impose restrictions on its exercise.
• The vetoed sections are valid conditions or restrictions on the power of augmentation.

• The issue is a political question beyond the Court's power to determine.
• Petitioners had a political remedy: to override the veto.
• Section 55 (and by extension, Section 16) is a "rider" because it is extraneous to the Appropriations Act and thus merits the President's veto.
• The President's power to augment items in appropriations for the executive branch is already provided for by law (Sections 44 and 45 of P.D. No. 1177, as amended by R.A. No. 6670).
• The President is empowered by the Constitution to veto provisions or other "distinct and severable parts" of an Appropriations Bill.
• The vetoed provisions nullify the constitutional and statutory authority of the President and other key officials to augment any item from savings.

• Whether the President exceeded her item-veto power under the Constitution by vetoing Section 55 of the General Appropriations Act of 1989 and Section 16 of the General Appropriations Act of 1990.
• Whether "provisions" in an appropriations bill, particularly those that are general law measures or inappropriate conditions, can be treated as "items" for the purpose of the President's veto power.
• Whether the vetoed sections unconstitutionally restrict the power of augmentation granted by the Constitution and existing statutes.

• The Supreme Court upheld the constitutionality of the President's veto and dismissed the petition.
• The Court held that while the Constitution grants the President the power to veto any particular "item or items" in an appropriation bill, this power can extend to "provisions" if such provisions are "inappropriate" in an appropriations bill.
• The Court found that Section 55 (FY '89) and Section 16 (FY '90) were not provisions in the budgetary sense (i.e., relating specifically to a particular appropriation) but were general law measures attempting to restrict the power of augmentation from savings.
• These sections did not relate to any particular appropriation, applied generally to all items disapproved or reduced by Congress, and were more of a congressional policy on augmentation rather than a budgetary appropriation.
• As "inappropriate provisions" that should be treated as "items," they were subject to the President's veto power. The legislature cannot insert substantive legislation into an appropriations bill to make it veto-proof.
• The Court further ruled that these sections were not true "conditions" or "restrictions" in the budgetary sense that would be exempt from veto if the appropriation itself was not vetoed, as they did not exhibit the necessary connexity with money items of appropriation.
• The vetoed sections impaired the constitutional (Article VI, Section 25(5)) and statutory (P.D. No. 1177, R.A. No. 6670, Section 12 of GAA 1989) authority of the President and other key officials to augment any item from savings. The power of augmentation, once authorized by law, allows flexibility in the use of public funds.
• The attempt by Congress to restrict this power of augmentation annually through the GAA was deemed inappropriate; such restrictions, if intended, should be embodied in separate legislation.

• Judicial Review — The power of the judiciary to determine the constitutionality of acts of other branches of government. Applied here to resolve the constitutional controversy between the legislative and executive departments regarding the President's veto power.
• Political Question Doctrine — The principle that certain issues are best left to the political branches of government for resolution and are not justiciable. The Court found this doctrine not to be an obstacle, as the case involved delimiting constitutional boundaries of power.
• Locus Standi (Legal Standing) — The right of a party to appear and be heard before a court. The Court recognized the petitioners' standing as members of the Senate and as taxpayers.
• Presidential Item-Veto Power (Line-Veto Power) — The power of the President to veto particular items in an appropriation, revenue, or tariff bill without vetoing the entire bill (Article VI, Section 27(2) of the Constitution). The Court interpreted this power to include the veto of "inappropriate provisions" in an appropriations bill that are essentially general law measures or conditions not directly related to a specific appropriation item, treating such provisions as "items" for veto purposes.
• Separation of Powers — The constitutional principle dividing governmental power among the legislative, executive, and judicial branches. The Court emphasized that neither the legislature nor the executive could encroach upon the constitutional powers of the other; the vetoed provisions were seen as legislative attempts to curtail executive power of augmentation.
• Power of Augmentation — The authority granted by the Constitution (Article VI, Section 25(5)) to the President, Senate President, House Speaker, Chief Justice, and heads of Constitutional Commissions, once authorized by law, to augment any item in the general appropriations law for their respective offices from savings in other items of their respective appropriations. The Court held that the vetoed provisions improperly restricted this power.
• Doctrine of Inappropriate Provisions/Riders — A provision in an appropriations bill that does not relate specifically to a particular appropriation therein and is essentially a matter of general law is considered an "inappropriate provision" or "rider." The Court ruled that such provisions can be treated as "items" and are subject to the President's item-veto power to prevent "logrolling" or forcing the executive to accept unwanted legislation.
• Statutory Construction (Strict vs. Liberal Construction of Veto Power) — The Court rejected a strict construction of the veto power, stating that courts should indulge every intendment in favor of the constitutionality of a veto, similar to the presumption of constitutionality for laws passed by the legislature.

• "Just as the President may not use his item-veto to usurp constitutional powers conferred on the legislature, neither can the legislature deprive the Governor of the constitutional powers conferred on him as chief executive officer of the state by including in a general appropriation bill matters more properly enacted in separate legislation... when the legislature inserts inappropriate provisions in a general appropriation bill, such provisions must be treated as ‘items' for purposes of the Governor's item veto power over general appropriation bills." (Quoting Henry v. Edwards)
• "The legislature cannot by location of a bill give it immunity from executive veto. Nor can it circumvent the Governor's veto power over substantive legislation by artfully drafting general law measures so that they appear to be true conditions or limitations on an item of appropriation." (Quoting Henry v. Edwards)
• "An item in a bill refers to the particulars, the details, the distinct and severable parts x x x of the bill... It is an indivisible sum of money dedicated to a stated purpose."
• "An 'item' of an appropriation bill obviously means an item which in itself is a specific appropriation of money, not some general provision of law, which happens to be put into an appropriation bill." (Quoting Bengzon v. Secretary of Justice, U.S. Supreme Court)
• "No provision or enactment shall be embraced in the general appropriations bill unless it relates specifically to some particular appropriation therein. Any such provision or enactment shall be limited in its operation to the appropriation to which it relates." (Quoting Article VI, Section 25[2] of the Constitution)

• Demetria vs. Alba (148 SCRA 209) — Cited to affirm the Court's duty to declare void acts of the legislature or executive that go beyond their constitutional powers, and to uphold the validity of the power of augmentation from savings.
• Sanidad v. COMELEC (73 SCRA 333) — Cited for the Court's discretion to entertain taxpayer suits.
• Tolentino v. COMELEC (41 SCRA 702) — Cited for the principle that a member of the Senate has the requisite personality to bring a suit where a constitutional issue is raised.
• Bengson v. Secretary of Justice (62 Phil. 912 [1936]) — Cited for the definition of an "item" in an appropriation bill and for the principle that the executive's veto power should not be strictly construed. The Court also noted its reversal by the U.S. Supreme Court (299 U.S. 410) on the ground that an appropriations bill was not involved in the U.S. case, and the U.S. Supreme Court's definition of "item" was adopted.
• Bolinao Electronics v. Valencia (11 SCRA 486) — Cited by petitioners for the rule that the President cannot veto a condition or restriction in an appropriations bill without vetoing the item itself. The Court distinguished this case, stating that the vetoed sections in the present case were not true conditions in the budgetary sense but general law measures.
• Commonwealth v. Dodson (11 S.E. 2d 120) — Cited for the definition of an "item" as an indivisible sum of money dedicated to a stated purpose.
• Henry v. Edwards (346 So.2d 153, 157-158 [1977]) — Extensively quoted and relied upon for the principle that inappropriate provisions in a general appropriations bill (i.e., general law measures not relating to a specific appropriation) must be treated as "items" for the purpose of the Governor's item veto power to prevent legislative encroachment on executive power and circumvention of the veto.
• Fairfield v. Foster — Cited for the rule that the Executive is not allowed to veto a condition or proviso of an appropriation while allowing the appropriation itself to stand, but the Court found the vetoed sections not to be true conditions.

• 1987 Constitution, Article VI, Section 1 — Defines judicial power, including the duty to settle actual controversies and determine grave abuse of discretion. Referenced to establish the Court's jurisdiction.
• 1987 Constitution, Article VI, Section 25(2) — States that no provision or enactment shall be embraced in the general appropriations bill unless it relates specifically to some particular appropriation therein. Used by the Court to argue that the vetoed sections were "inappropriate provisions."
• 1987 Constitution, Article VI, Section 25(5) — Authorizes the President, Senate President, House Speaker, Chief Justice, and heads of Constitutional Commissions, by law, to augment any item in the general appropriations law from savings. The President cited this as being violated by the vetoed sections; the Court agreed the sections impaired this power.
• 1987 Constitution, Article VI, Section 27(1) — Details the general veto power of the President over entire bills and the process for overriding a veto.
• 1987 Constitution, Article VI, Section 27(2) — Grants the President the power to veto any particular item or items in an appropriation, revenue, or tariff bill. This is the central provision defining the item-veto power discussed.
• 1987 Constitution, Article VII, Section 22 — Requires the President to submit the budget to Congress. Mentioned in the text of the vetoed provisions.
• 1987 Constitution, Article XVIII, Section 3 — Provides for the continuance of laws, decrees, etc., not inconsistent with the Constitution until amended, repealed, or revoked. Referenced to counter the argument that P.D. No. 1177 was revoked by the Constitution.
• Presidential Decree No. 1177 (Budget Reform Decree of 1977), Sections 44 and 45 — Section 44 authorizes the President to augment any appropriation of the Executive Department from savings. Section 45 authorizes the President to use savings to cover deficits. Cited by respondents and the Court as existing statutory authority for augmentation.
• Republic Act No. 6670 — Amended P.D. No. 1177, affirming the President's authority to use savings.
• General Appropriations Act of 1989 (Rep. Act No. 6688), Section 12 — Authorizes the President and other key officials to use savings to augment items in the Act for their respective offices.
• General Appropriations Act of 1989 (Rep. Act No. 6688), Section 55 — The vetoed provision prohibiting augmentation of items disapproved or reduced by Congress.
• General Appropriations Act of 1990 (Rep. Act No. 6831), Section 16 — The vetoed provision containing a similar prohibition as Section 55 of the 1989 GAA.
• 1935 Constitution, Article VI, Section 11(2) — Previous provision on item-veto power which explicitly mentioned veto of provisions related to items. The Court noted its evolution.
• 1973 Constitution, Article VIII, Section 16(5) — Provision on augmentation power.
• 1973 Constitution, Article VIII, Section 20(2) — Previous provision on item-veto power which omitted reference to veto of provisions. The Court noted the 1987 provision is a verbatim reproduction.

• Justice Cruz — Argued that the President's power of augmentation under Article VI, Section 25(5) is not self-executing and requires statutory authority; Congress, having granted this authority (e.g., via P.D. No. 1177), can also modify or revoke it through provisions like Section 55. He contended that Section 55 is not a rider as it deals with appropriations and that Congress has the freedom, vested by the Constitution, to grant or withhold the power to augment. The vetoed section seeks to withdraw a delegated power, which Congress is entitled to do.
• Justice Gutierrez, Jr. — Believed the veto violated separation of powers and negated Congress's power over the public purse. He argued that allowing the President to restore funds for abolished or reduced functions/offices through augmentation amounts to fund juggling and allows a modified lump sum appropriation for the Executive. He emphasized the distinction between "item" and "provision," stating the Constitution withholds the power to veto provisions. He viewed the vetoed provisions as legitimate exercises of Congressional power to state what items may not be augmented, not inappropriate riders.
• Justice Padilla — Maintained that the questioned veto has no constitutional basis as Article VI, Section 27(2) limits the President's special veto power to "items," not "provisions." He argued that Section 55 (FY 1989) and Section 16 (FY 1990) are founded on sound reason and public policy, as they ensure that Congressional disapproval or reduction of an appropriation is not rendered meaningless. He cited Bolinao vs. Valencia to support the view that a condition in an appropriation measure cannot be vetoed separately from the appropriation itself.