Philippine court rules 'pork barrel' fund illegal in blow to Aquino

MANILA (Reuters) - The Philippines’ highest court ruled on Tuesday that a widely misused fund for legislators’ pet projects was unconstitutional in an embarrassing blow for President Benigno Aquino and ordered the money be returned to the Treasury.

The scandal over lawmakers’ misuse of “pork barrel” funds has become the biggest crisis of Aquino’s three-year rule, tainting his image as a corruption fighter and undermining his ability to push economic reforms.

The Priority Development Assistance Fund (PDAF) has been widely lambasted for channeling money to projects solely to impress voters, though many of the projects have turned out to be non-existent.

“This will surely hurt the presidency,” said Ramon Casiple, executive director of the Institute for Political and Electoral Reforms. “It means it will be very difficult for the executive and legislative branches to create discretionary funds.”

Congressman Ben Evardone, who is from Eastern Samar, one of the provinces hardest-hit by Typhoon Haiyan, said the court decision would make it difficult to raise funds for reconstruction.

“While all sectors of society in the national and international community are in a frenzied mood to look for resources to support the typhoon victims, the Supreme Court appears to be insensitive to our situation,” he told reporters.

Aquino, who is supervising relief efforts in storm-ravaged Tacloban city in the central Philippines, was flying back to Manila to talk to aides, his spokesman said.

Court spokesman Theodore Te said the court found the laws allowing lawmakers to dip their fingers into the annual budget for their own projects violated the constitution. About 25 billion pesos ($573.66 million) was allocated in the proposed 2014 budget before Aquino was forced to scrap the projects.

Analysts say pork barrel funds have been used by every sitting president to buy loyalties of lawmakers as well as influence their vote on crucial legislative and political measures.

Three senators and several former congressmen are facing corruption charges before an anti-graft agency for the misuse of pork barrel funds from 2007 to 2009.

In a Senate public inquiry two weeks ago, a whistle blower said about 50 percent of pork barrel funds were routed back to lawmakers in a scheme ran by a businesswoman at the centre of the controversy.

Reporting By Manuel Mogato; Editing by Nick Macfie