COA wants ex-DBM execs probed over release of P38.8B in Malampaya funds

Former officials of the Department of Budget and Management (DBM) are facing investigation over the questionable release of P38.8 billion worth of revenues from the Malampaya Natural Gas Project in Palawan from 2004 to 2012.

In an 80-page Sectoral Performance Audit report released on October 30, the Commission on Audit found (COA) that the disbursement of the amount—more than 22 percent of the total P173.3 billion collected by the government as of June 30, 2013—"may not be considered proper in view of non-compliance with existing laws, rules and regulations."

“In view of the apparent disregard of applicable laws, rules, and regulations which contributed to the misuse of funds,… the (audit) team recommends immediate conduct of investigation to determine officials and employees who may be responsible for the questionable release of funds and file appropriate charges, if warranted,” COA said.

COA did not identify who will be those included in the probe. The special team, nonetheless, forwarded it to incumbent DBM Secretary Benjamin Diokno, former DBM Secretary and incumbent Camarines Sur Representative Rolando Andaya, and ex-DBM officials Mario Relampagos and Nora Oliveros. 

The audit of the Malampaya fund releases spanned through three budget secretaries—Emilia Boncodin, Romulo Neri, Andaya and Butch Abad—and through the administrations of former Presidents Gloria Macapagal-Arroyo and Benigno Aquino III.

Irregular disbursement

COA blamed DBM for the “irregular disbursement of public funds"  due to the agency's failure to "evaluate and establish the basis for the release of Malampaya funds" to 62 implementing agencies involving 184 special allotment release orders worth P36.3 billion.

“In the absence of specific documentary requirements, the DBM does not have an idea on whether the project was necessary or not. This clearly manifested that the DBM released the funds without thorough evaluation,” COA said.

Based on the table provided in the report, the Department of Finance-Bureau of Treasury had the biggest amount of funds released at P9.9 billion.

This includes the relocation of families affected by typhoons in cooperation with the National Housing Authority worth P1.4 billion and electrification projects under the National Electrification Administration worth P1.9 billion.

The Department of Public Works and Highways came second in the list for its various road and infrastructure projects worth P7.6 billion, followed by various projects under the Department of National Defense-Armed Forces of the Philippines at P7.5 billion such as housing and repair of typhoon-damaged facilities at the Philippine Military Academy.

Other implementing agencies included in the COA report are the following: Department of Agriculture (P5.8 billion), Department of Interior and Local Government-Philippine National Police (P2.1 billion), DBM (P2.1 billion), Department of Energy (P1.9 billion), Department of Agrarian Reform (P900 million), and Department of Health (745.9 million).

The Department of Science and Technology-Philippine Atmospheric Geophysical and Astronomical Services Administration had the least amount of disbursement in the COA report at P400,000, followed by the Department of Transportation-Philippine Coast Guard at P50 million, the DILG at P150 million.

Unserved purpose

Meanwhile, COA emphasized that none of the funded projects were used for energy development projects, except that it was used for "other purposes" as stated under Presidential Decree No. 910.

PD 910 states that revenue from projects such as those from Malampaya should be used to "finance energy resource development and exploration programs and projects of the government and for such other purposes as may be hereafter directed by the President."

"The very purpose for which Malampaya Fund was established is therefore yet to be served," COA said.

"As may be noted, fund releases of P39.8 billion as of May 21, 2012 were not intended for energy resource development and exploitation programs and projects of the government but fall under other purposes as may be directed or authorized by the president," it added.

In response, Andaya said requests for funding from the Malampaya funds had always been in compliance with government laws during his time at the DBM.

"Prior to the release of government funds, including Malampaya fund, the requests for funding go through the reguar and strict process of determining compliance with and completeness of all the documentary requirements under existing laws, rules and regulations," Andaya said.

The Office of the Ombudsman indicted Andaya of plunder for the anomalous use of P900 million worth of Malampaya funds.

Arroyo, on the other hand, was cleared of the charge.

Diokno, for his part, said all Malampaya fund releases made were "consistent" with the directives of the president. COA asked the Cabinet official on future actions of the DBM on the matter.

Relampagos, who is facing criminal charges over the pork barrel fund scam, adopted the comments of the Diokno in the COA report.

Former Palawan Governor Mario Joel Reyes is likewise facing graft charges before the Sandiganbayan over the alleged anomalous use of some P1.53 billion from the fund. He has since sought for its dismissal. —NB, GMA News