Noy OKs P17.6B ‘augmentation’

Savings from 2014, 2015 used

Former President Aquino has approved a total of P17.6 billion in savings to “augment” several projects months prior to the campaign period of the May 2016 presidential elections.

The bigger amount was contained in a Dec. 29, 2015 memo the Daily Tribune earlier had reported to have packaged the P8.7-billion Barangay Health Stations (BHS) and the P3.5 billion Dengvaxia purchases.

Documents obtained from the Department of Budget and Management (DBM) showed a memorandum from former Executive Secretary Paquito Ochoa informed then Budget Secretary Florencio Abad that Aquino approved funds augmentation using 2014 savings of the Department of Public Works and Highways (DPWH) and 2015 savings from the Miscellaneous Personnel Benefits Fund (MPBF).

A source at the Department of Finance (DoF) said Abad delegated the signing of the special allotment release order (SARO) to “career officials”.

“The lower officials can’t do anything but to follow orders [in signing the SARO],” the source added.

In signing the SARO the subordinates of Abad “were reluctant,” the source added.

The memo consolidated P17,600,386.327 worth of projects to use government savings, P4.1 billion of which used DPWH savings from 2014 and P13.5 billion from 2015 MPBF savings.

From the 2014 DPWH savings, came the augmentation of P1.16 billion for the unfunded balance for the typhoon “Yolanda” resettlement project of the National Housing Authority (NHA), the P969 million for the construction of housing units for the Yolanda resettlement also of the NHA and the P738 million for Yolanda repair and rehabilitation project of the Department of Interior and Local Government (DILG).

The BHS project and the Dengvaxia purchases were sourced from 2015 MPBF Savings. A total of 11 departments, with the Department of Health (DoH) getting the bulk of the budget, obtained augmentation funds through savings on Dec. 29, 2015 – the last working day before an election year.

A legal expert said the use of the 2014 savings was illegal considering the budget principle of “spend it or lose it” which means that savings from a previous year should have reverted to the national treasury.

The DoF source said projects from 2014 can crossover to the next year if these are “continuing projects” with multi-year contracts but the funds from these can’t be converted into savings.

But based on Department of Budget and Management’s (DBM) circular 551, appropriations for 2014 cannot be used for 2016 projects.

“If there will be continuing appropriations it will only be until Dec. 31, 2015. By January 2016, the appropriations should have lapsed,” a DBM source said.

Urgent projects?
Ochoa’s memo requested authority to use government savings to fund “urgent” projects, including the construction of P5.316 billion worth of barangay health station (BHS) project of DoH.

Ochoa described the projects that needed funding as “Yolanda-related and deficient projects.”

Other DoH projects ordered funded by Aquino were the P3,392,005,568 acquisition of medical equipment for the BHS, the P639 million procurement of 162 mobile dental units and the P3,556,155,900 dengue vaccine program for National Capital Region (NCR) Regions III and IV-A.

Other government agencies that got allotment were the Department of Transportation and Communications with P17,500,000; the Department of Interior and Local Government (DILG) with P737,938,480 for repair and rehabilitation of facilities damaged by Yolanda; the Local Water Utilities Administration (LWUA) with P660,000,000 for water supply to NHA resettlement areas and the National Electrification Administration (NEA) for electrification of Yolanda-affected communities for P528.2 million.

The DILG was allotted with additional P105,466,750 for food allocation of inmates of the Bureau of Jail Management and Penology (BJMP); the DoTC also got P237,394,841 more for payment to National Food Authority (NFA); the Department of Environment and Natural Resources (DENR) with P197,664,524, and the Department of Energy (DoE) got P40,000,000 for alternative fuels and energy efficiency programs.

DoH seeks CoA audit
The Department of Health (DoH) has requested the Commission on Audit (CoA) to look into the DoH projects totaling P9.39 billion covered by the Dec. 29, 2015 SARO.
Health Secretary Francisco Duque told Daily Tribune yesterday all DoH projects covered by the SARO, amounting P9.392 billion, are now subjects of fraud audit by CoA.
“All projects related to the Dec. 29, 2015 SARO, including BHS (barangay health station) Phase 1 (are now under audit),” Duque said.

The SARO was funded through the Miscellaneous Personnel Benefits Fund (MPBF) savings for Calendar Year 2015.

Aside from the BHS Phase 1 amounting P5,361,000,000, the SARO also covered Tsekap equipment worth P3,392,005,568 and the acquisition of 162 mobile dental units amounting P639,000,000.

“If there is fraud then this will be used to make the responsible people accountable,” Duque vowed.

Duque said the BHS Phase 1 project, which was the subject of the hearing conducted by Sen. Joseph Victor Ejercito last Wednesday, has already been terminated.

Duque added he requested CoA audit to get to the bottom of the DoH projects.
The DoH chief said he would wait for the CoA findings before deciding on the fate of the projects.

All of the projects were initiated during the time of former Health Secretary Janette Garin and could be considered as “midnight releases,” noting Dec. 29, 2015 was the last working day of that year and a few months before the May 2016 national polls.

BHS poorly planned
On the BHS Phase 1 project which he described as “poorly planned and full of deficiencies,” Duque noted conflicting findings by DoH personnel, particularly on the number of completed units.

“At the end of the day, what will be the documentary evidence that will give us the truthful story? CoA is the best to do that because it can order to produce them,” Duque said in an ambush interview

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