G.R. No. 169726 , March 18, 2010.
DEPARTMENT OF BUDGET AND MANAGEMENT, represented by Sec. EMILIA T. BONCODIN, Petitioner, vs. OLIVIA D. LEONES, Respondent.

FACTS

Respondent Olivia D. Leones was the Municipal Treasurer of Bacnotan, La Union, receiving representation and transportation allowance (RATA) on top of her salary. In December 1996, she was reassigned to the Office of the Provincial Treasurer of La Union pending administrative cases. The Municipality of Bacnotan stopped paying her RATA upon reassignment. After unsuccessful administrative relief and a dismissed mandamus suit, respondent sought an opinion from the DBM Secretary. In an Opinion dated September 3, 2003, the DBM found her entitled to RATA only for 1999, as the General Appropriation Act (GAA) for that year alone did not require “actual performance of… functions” as a condition for receipt. Respondent filed a certiorari petition with the Court of Appeals, contending the non-payment violated the rule on non-diminution of salary in reassignments. The Court of Appeals granted her petition, ordering payment of RATA for the duration of her reassignment, characterizing RATA as part of salary. The DBM filed this petition, arguing RATA is not part of salary and is paid based on actual performance of functions.

ISSUE

Whether respondent, after her reassignment to the La Union treasurer’s office, was entitled to receive RATA.

RULING

Yes, respondent was entitled to receive RATA after her reassignment, not because it forms part of her salary, but because the discontinuance of payment lacks legal basis. The Court held that RATA is distinct from salary; it is an allowance to defray representation and transportation expenses, paid only to certain officials by the nature of their offices. However, the denial of RATA must be grounded on relevant and specific provision of law. The DBM’s bases for denial—the GAAs from 1996 to 2005 (except 1999) requiring actual performance of functions, and Section 3.3.1 of National Compensation Circular No. 67—do not apply. The GAAs are irrelevant as respondent, a local government official, is compensated from local appropriation laws passed by the Sangguniang Bayan of Bacnotan, not the national budget. Incorporating national budgetary conditions into local ordinances would violate the constitutional mandate on local autonomy. Furthermore, National Compensation Circular No. 67 applies only to national government officials and employees, excluding local government officials like respondent. Even assuming applicability, respondent falls under the exception in Section 3.3.1, as she was reassigned within the same agency (the Department of Finance) to duties comparable to her previous position. Thus, no law justifies the denial of RATA to respondent during her reassignment.