MANILA — Several labor organizations and civil society groups are now calling for the resignation of Ralph G. Recto, following the decision of the Supreme Court of the Philippines (SC) to declare the diversion of billions from Philippine Health Insurance Corporation (PhilHealth) funds to the national treasury as unconstitutional.
(ads1)
🏛 What the Court Ruled
On December 3, 2025, the SC en banc issued a landmark ruling: the transfer of ₱60 billion in excess PhilHealth funds to the national treasury — authorized under a special provision in the 2024 budget and implemented via a circular by the Department of Finance (DOF) — violates the Universal Health Care Act (UHCA). The Court declared both the provision and circular void, citing the law’s clear requirement that PhilHealth reserves be used only to improve member benefits or reduce contribution rates.
The ruling permanently halted the transfer of the remaining ₱29.9 billion, and ordered the full return of the ₱60 billion to PhilHealth via the 2026 national budget.
😡 Why Labor Groups Say Recto Should Resign
Labor coalitions such as Nagkaisa Labor Coalition — among those who first raised legal challenges — argue the diversion represented “negative social justice”: funds contributed by workers and ordinary Filipinos were used for “unprogrammed appropriations” instead of health care. (ads2)
They say Recto’s role — as Finance Secretary at the time the transfer was approved and implemented — constitutes a betrayal of public trust. For many Filipinos who depend on PhilHealth, the diversion signaled that contributions meant for their health and welfare could be treated like a generic pool for government spending.
Some labor leaders and allied lawmakers now insist that returning the money is only a first step. True accountability requires Recto’s resignation — to restore public faith and ensure such misuse of social funds is not repeated.
✅ What This Means for PhilHealth & Public Trust
The SC ruling strengthens the protection of social health insurance funds from being diverted to unrelated government spending — reinforcing that PhilHealth’s reserves must serve health benefits under the UHCA.
The return of the ₱60 billion under the 2026 budget — as announced by Congress — restores the financial basis for PhilHealth to continue operations, expand benefits, or subsidize health premiums.
However, many workers’ groups remain unconvinced that this solves the root problem: they demand structural reform, transparent governance, and responsibility for those behind the diversion — including Recto.
📰 The Bigger Picture: Accountability & Social Insurance
The PhilHealth fund diversion saga has become a litmus test for whether public institutions can safeguard social insurance resources against political or fiscal expediency. With the Supreme Court’s ruling, the balance tilts in favor of protecting workers’ rights to health care. But for many activists and labor advocates, this is not just about money — it is a demand for institutional integrity, transparency, and respect for laws designed to protect ordinary Filipinos.
Whether the demand for Recto’s resignation will succeed remains to be seen — but the public debate it has sparked underscores the importance of vigilance and participation in guarding social‑welfare mechanisms.
