OVP has P95-M in unliquidated PDAF —COA

At least P95 million of the Priority Development Assistance Fund (PDAF) of the Office of the Vice President remains unliquidated even after two years, the latest Commission on Audit (COA) audit report showed.

A total of P77.46 million of PDAF allocated to the national government agencies (NGA) - Department of Public Works and Highway (DPWH) and the Commission on Higher Education (CHED) – remains unliquidated as of the end of 2014, the report said.

The DPWH allocation holds the largest unliquidated PDAF fun, amounting to a total of P 59.46 million. The COA report stated that this was for the construction/repair/rehabilitation of the Office of Senior Citizens Affairs Multi-Purpose Building.

P18 million of PDAF fund for CHED is also still unliquidated. The allocation was simply described as “for educational/scholarship program” in the report.

"Section 4.6 of COA Circular No. 94-013 dated December 13, 1994 provides that within ten (10) days after the end of each month/end of the agreed period for the project, the Implementing Agency (IA) shall submit the Report of Checks Issued (RCI) and the Report of Disbursements (RD) to report the utilization of the funds. Only actual project expenses shall be reported. The reports shall be approved by the Head of the IA," the COA said.

Both funds were allocated in 2012. The audit report did not provide any more details on the said projects.

The audit report totalledthe OVP’s dues from national government agencies to P84.73 million, including the funds from DPWH and CHED.

PDAF was declared unconstitutional by the Supreme Court on November 19, 2013. Unused PDAF should be returned to the national treasury pursuant to the decision of the high court.

Love your own

Also in 2012, the OVP allocated P32 million to the local government unit of Makati from the PDAF of the Vice President – where his son was mayor and his daughter is congressman.

The allocation was for the implementation of various social services, health and livelihood-training programs of the office.

However, the COA report pointed out that more than half of this, or P17.62 million remains unliquidated as of 2014. The P14.38 million was unutilized and eventually returned to the Bureau of the Treasury.

The agency also noted that some equipment for a project funded by PDAF have not reached the intended beneficiaries.

VP Binay is the father of former Makati City Mayor Jejomar Erwin “Junjun” Binay, who was the city’s mayor from 2010 until he was suspended and eventually disqualified earlier this year. VP’s daughter, Mar-Len Abigail Binay is the city’s second district representative. VP Binay himself was the city’s long-time mayor.

Among the unliquidated fund from the OVP’s PDAF was the P879,550 paid to a certain MPL Trading in 2013 for “food commodities intended for Habagat victims.”

No other details on the payees were provided according to the audit report.

GMA News Research earlier revealed that the owner of a certain MPL Trading, Manuel P. Layug contributed in 2013 P1 million to the campaign kitty of the VP Binay’s daughter, Senator Nancy Binay. He was among the biggest campaign contributor of the neophyte senator.

We also found out that the same MPL Trading won at least five contracts from the city which totalled to at least P P238.83 million.

ALSO SEE: Makati contractors contributed to Nancy, Junjun Binay’s campaigns

In an interview with Senator Binay last year, she told GMA News that she does not know Layug, adding she did not know all her contributors personally.

It is, however, unclear if MPL Trading which was the payee of the unliquidated PDAF fund according to the COA report is the same MPL Trading owned by Layug.

Aside from the food commodity for the Habagat victims, there are two other unliquidated disbursements noted by COA: P9.72 million paid to Dane Degala-Castillo Pharmacy for medical equipment to be used by the Makati Social Welfare Department - Senior Citizen Health Services Program, and P7.03 million paid to Classera Enterprises for the sewing machines allotted for the "livelihood Program of the Office of the Vice-President".

COA said that according to the resident auditor of the city, said purchased sewing machines were not yet distributed to the intended beneficiaries.

Negotiated procurement, non-essential goods

COA in the same audit report also noted that since 2011, the OVP has been employing the services of one particular entity “for the supply and delivery of various essential goods such as noodles, sardines, biscuits, among others,” which were distribution to the victims of calamities. The procurement totaled P94.72 million.

The said supplier did not have a permit to distribute such goods, COA noted. The agency did not name the said supplier, only noting that the City of Makati issued its business permit.

COA also said thatthe OVP entered into a negotiated contract with the supplier.

“Verification of the Business/Mayor’s Permit of one of the top suppliers ofthe OVP revealed that the authority covered by his permit pertains to supply of non-essential goods instead of essential goods such as canned goods, noodles, among others,” COA said in its report.

The agency also examined the barangay clearance of the supplier and found out that the line of business of the supplier is “the trading of office supplies,” which COA remarked as "considered to be non-essential.”

“The supplier’s transactions with the OVP were contrary to the business permit when the delivered goods were essential commodities,” COA said.

COA also said that these transactions were contrary to the Revised Makati Revenue Code, which requires entities who want to engage in more than one kind of business or trade to pay the required permit fees and taxes on each separate or different business or trade.

OVP, in its answer to COA, said that “it overlooked the details on the requisite Business Permit where the authority was for non-essential items only,”.

The office also stressed that the supplier met all the purchase orders.

OVP travels

Aside from the discrepancy with the business permits, COA also remarked the irregularities in the negotiated contracts entered into by the OVP and three travel agencies: Uni-Orient Travel Agency, Inc., TAT Philippines Travel Agency, and Infinite Travel and Tours Corporation.

The OVP paid P8.9 million for the local and foreign airfare tickets of OVP personnel in 2014, including those of the Vice President and his security details.

COA noted that there was “no valid justification to use negotiated mode of procurement” in the availment of the services of the travel agencies. Also, these services were not included in the Annual Procurement Plan ofthe OVP.

COA further stated that these procurements were not posted in the Philippine Government Electronic Procurement System (PhilGeps), which is mandated by law.

Batangas scholars

Aside from PDAF to the Vice President's home city, the OVP also provided scholarship exclusively to Batangueños, COA noted.

VP Binay traces his roots to the province. His father was from Bauan, Batangas.

The Vice President Jejomar C. Binay (VPJCB) Scholarship Program started in SY 2011-2012. In CY 2014, the OVP allotted a total of P3.4 million to the program for the following universities: Manila Central University (P1.32 million), University of the Philippines-Diliman (P912,644.80), and University of Batangas (P1.17 million).

COA listed down various irregularities in the VPJCB Scholarship Program. The audit called on the program’s lack of statement of policy and objective, among others.

The agency specially pointed out the allocations of scholarship to the University of Batangas, calling the program “discriminatory being applicable only to Batangueños and not open to prospective beneficiaries from other provinces”.

COA said that this limited the benefit to the Batangueños only, even if the source of fund came from the national budget.

COA also said that the program does not have a monitoring and feedback mechanism, and no readily-available information on the status of the scholars.

OVP, in its answer, committed to have well-defined guidelines in implementing the program.

Commendations from 2011 to 2013

VP Binay refused to comment on the COA report.  His camp, however is “puzzled” with the 2014 audit.

“From 2011 until 2013, COA has been commending the OVP for its programs and its compliance with procedures” UNA Secretary General Atty. JV Bautista said in an interview with GMA News’ Ivan Mayrina.

“COA Chairman Michael Aguinaldo should at the minimum immediately go on leave. It cannot be disputed that COA continues to pursue the harassment and persecution of political opponents of the administration which began under his predecessor,” said Bautista. —with reports from Ivan Mayrina, GMA News