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COA: Gov’t lost P1.331-B due to unreturned advance payments

An audit report released by the Commission on Audit (COA) showed that the government lost P1.331 billion due to advance payments that were not returned by contractors despite the projects being already completed or had been discontinued.

According to Dano Tingcungco’s report on “24 Oras Weekend,” the unreturned payments violated provisions of the Government Procurement Act which states that contractors must return advance payments when projects were completed or halted.

The report showed that payments for around 530 completed and 21 discontinued Department of Public Works and Highways (DPWH) projects were not returned.

According to COA, the region with the highest number of such cases was Region X with 128 completed projects. This came to P265,565,963 which was not returned.

The DPWH said that it was unable to regain the payments as contractors were late or did not submit the final billing of the project.

However, COA countered that the DPWH should have been stricter on the matter as the money could have been used for more projects. It also recommended that contractors that failed to return the advance payments should be fined.

“Demand for the immediate refund of the unrecouped advances or forfeit the corresponding irrevocable standby letters of credit or guarantee payment bonds posted by the contractors,” COA said.

“Initiate legal actions to those who refuse to refund the unrecouped advances, if warranted,” it added.

It also recommended that the DPWH create a separate committee that would oversee the payment of contractors.

The department was also advised to fix the records of completed projects which may be charged anew, and officials and personnel who were unable to return the advance payment needed to be penalized. — Joahna Lei Casilao/DVM, GMA News