COA flags Coast Guard over purchase of P7.8 million luxury vehicle

The Commission on Audit raised concerns over the Philippine Coast Guard's (PCG's) luxury vehicle purchase in 2022 despite an existing ban on such purchases.

COA, in its annual audit report on the PCG, said the Coast Guard purchased a six cylinder, 3956 CC Toyota Land Cruiser Prado worth around P5 million in 2022, a purchase considered a “luxury vehicle” and therefore, prohibited under Malacañang Administrative Order (AO) No. 14.

Palace AO 14 states that “All government agencies are prohibited from acquiring and/or using luxury vehicles for their operations.”

Luxury vehicles were defined  as:

• car (sedan or hatchback) with an engine displacement exceeding 2500 cc if gasoline-fed; or 3000 cc if diesel-fed;
• passenger van or pick-up type vehicle with an engine displacement exceeding 2500 cc if gasoline-fed or 3000 cc if diesel-fed;
• AUV/CUV/MPV with an engine displacement exceeding 2500 cc if gasoline-fed; or 2800 cc if diesel-fed; and/or with an engine exceeding four cylinders; and
• SUV with an engine displacement exceeding 2700 cc if gasoline-fed, or 3000 cc if diesel-fed, and/or with an engine exceeding four cylinders.

Furthermore, the COA said the PCG also spent P2.8 million for the bulletproofing of the said Land Cruiser Prado.

The PCG, in response to state auditors, said that the acquisition of the Toyota Land Cruiser Prado was necessary for the PCG to ensure safe and secure transportation of the Commandant and to uphold the PCG’s mandated functions.

Meanwhile, state auditors also flagged the PCG’s acquisition of new vehicles, including the Land Cruiser Prado, by using rebates from Petron Corporation.

“It is worth mentioning that the National Headquarters (NHQ)-PCG and its Districts owned approximately 459 service vehicles, as evidenced by the Motor Vehicles Schedule obtained from the records. Considering the total number of motor vehicles, the necessity of acquiring new vehicles to utilize the rebates from Petron Corporation cannot be adequately established,” COA said.

The PCG responded that the acquisition of motor vehicles through fuel, oil, and lubricants (FOL) rebates from Petron Corporation was driven by several key factors which affect the PCG's operational effectiveness.

These include:

• the current number of issued land and floating assets (e.g. motor vehicles and aluminum/rubber boats) does not suffice the demand in PCG services; and
• the number of activated units and districts and workforce within the PCG, which continues to increase.

“The acquisition of vehicles through rebates is an opportunity for the PCG to capacitate the Command to become more responsive to the challenges prompting the organization,” the PCG said.

In closing, COA tasked the PCG to secure a post facto approval from the Secretary of the Department of Budget and Management for the acquisition of the Toyota Land Cruiser Prado pursuant to AO No. 14 s. 2018 and submit the same to the Office of the Auditor.

COA said the PCG had agreed to the recommendations.

GMA News Online had sought the PCG’s comment on the COA report, but the Coast Guard had yet to reply as of posting time. — DVM, GMA Integrated News