Suspension of Malampaya funds to derail AFP modernization

MANILA, Philippines - The Department of National Defense (DND) on Tuesday admitted that the Supreme Court’s decision to stop the release of Malampaya funds would affect the modernization of the military.

DND Secretary Voltaire Gazmin said the proceeds from the Malampaya natural gas project is one of the funding sources of the Armed Forces’ upgrade program.

The Malampaya funds, Gazmin added, are also being used to refurbish the two ships recently acquired from the United States (US).

“The funds used to acquire accessories we need to install (on the ships) also came from the Malampaya (proceeds). It will definitely affect the modernization (of the armed forces),” the defense chief said.

The two ships acquired from the US have been renamed BRP Gregorio del Pilar and BRP Ramon Alcaraz.

The two frigates were intended to boost the Navy’s territorial defense capabilities and to secure the country’s natural resources including gas projects.

Gazmin, nevertheless, believes that the suspension of the release of the Malampaya proceeds would not delay the modernization program.

“This will not cause delays because our ships are already there. What will happen is we won’t be able to maintain them,” he said in Filipino.

Gazmin though believes that it would not take long before the impasse on the Malampaya funds is resolved. He believes that the needs of the military would eventually be understood.

Early this month, the Supreme Court issued a temporary restraining order that barred the release of Malampaya funds and the remaining priority development assistance fund (PDAF) of lawmakers this year.

The high court stopped the executive department from releasing Malampaya funds under the phrase “for such other purposes as may be hereafter directed by the President' under Section 8 of Presidential Decree No. 910, but not for the purpose of 'financing energy resource development and exploitation programs and projects of the government' under the same provisions."

The decision stemmed from separate petitions filed by groups claiming that the Malampaya funds are being plundered systematically by the government.

The Malampaya natural gas project is located in Palawan and is the source of electricity of power plants that provide electricity to a huge part of Luzon including Metro Manila.

Aside from the Malampaya funds, other funding sources for the military’s upgrade program are the national budget, the president’s commitment, and remittances from the Bases Conversion and Development Authority, which is tasked to convert former military bases into investment and business havens.