THE Procurement Service-Department of Budget and Management (PS-DBM) vowed to return by the end of this year or early next year P10.87 billion in “dormant” interagency transferred funds flagged by the Commission on Audit (COA).
During the Senate Committee on Finance’s hearing on the proposed 2022 budget of DBM, PS-DBM Administrative and Finance director Joshua Laure said they have already started the process of reverting the funds to the Bureau of the Treasury (BTr).
“Internally, being the OIC [Officer-In-Charge]-Director of the Admin and Finance Group, we set a deadline at the end of this year to remit all these funds to BTr and we have started doing so; [our process is] continuous, but obviously [there are several] agencies [involved here] and we are starting with the biggest ones down to the smallest; so our target is by the end of this year. If not, by the first quarter of 2022 but rest assured the process is ongoing,” Laure said, partly in Filipino.
In its 2020 Financial Audit of PS-DBM, COA said the amount refers to interagency transferred funds and other payables pertaining to advances for common-use supplies and equipment (CSE) which remained undelivered or unutilized and dormant for years.
According to COA, this deprived the government of funds it could have used in the implementation of its projects or programs.
The state auditor’s findings also showed that the bulk of the amount, or P8.95 billion, now has an “aging” or four years and above while the remaining P1.92 billion were aging for two to three years.
Moreover, the lion’s share of the funds or P10.5 billion came from national government agencies. Those which came from government-owned and -controlled corporations and local government units amounted to P331.32 million and P35.73 million,
respectively.
Budget OIC and Undersecretary Tina Canda said both the agencies and the PS-DBM are “to blame” for having unused funds.
For one, Canda said PS-DBM is benefitting from the interest that they earn from the parked funds.
“On the part of PS, it is to the advantage of the Procurement Service. Why? They earn interest so even if I don’t do procurement, I will earn interest,” Canda said.
“Actually it does not help the system altogether,” she added.
She noted that there was a time when even funds for non-CSE were transferred by agencies to the PS-DBM, which she said is not in line with the mandate of the agency.
At one point, parked funds in PS-DBM reached P333 billion during the last period of the Aquino administration and the first part of the Duterte administration.
Canda explained how this happened: back then, there were items for certain projects of infrastructure agencies, which cannot be obligated on the part of the implementing agency. She said most of these items were for the projects of the Department of Transportation, which “were not moving.”
“So the PS became a parking [venue] then. Second, there are controversial items in the budget of the agency, which by tradition they cannot purchase because of the nature of transaction. This specifically I would mention probably fire trucks. They are always wrought with considerations not related to procurement so what the Bureau of Fire [Protection] does is to move the funds to PS,” she said.
Bills have already been filed in both the Senate and the House of Representatives to abolish
PS-DBM, as the Senate continues to investigate the procurement of allegedly overpriced medical supplies from Pharmally Pharmaceutical Corp.