GSIS admits P35-B in members’ contributions unaccounted for

The Government Service Insurance System (GSIS) admitted yesterday that there was at least P35 billion worth of contributions that were not accounted for due to irregularities in the posting of remittances by government agencies.

Meeting with the members of the Philippine Government Employees Association (PGEA), GSIS officials admitted for the first time that the "culprit" of the missing funds was internal.

GSIS president and general manager Winston Garcia told reporters that the fund still had to verify exactly how much was "unaccounted for."

Garcia and other top GSIS officials met with PGEA members yesterday in an attempt to pacify the uproar that has led to delays in the payment of benefits and the suspension of loans to GSIS members.

During the meeting, GSIS officials openly admitted having committed "errors" in the accounting of the remittances by government employees.

According to Leticia Sagcal, senior vice president for social insurance, the "culprit was in the posting" of remittances because GSIS employees were depending on the certificates of payment submitted by the government agencies.

Under normal circumstances, government agencies automatically withhold GSIS contributions from the salaries of government employees. These contributions are then remitted to the GSIS and certificates of payment were issued.

Sagcal explained that when government agencies remit their GSIS payments to the fund, GSIS employees did not verify the total remittances against the report of the government agencies and instead tallied the amount based on the certificates of payment that were posted.

The problem, however, was that not all certificates of payments were being posted in the GSIS books as having been received by the fund, Sagcal said.

"We admit that there were remittances that were not posted and some have been lost," Sagcal said. "The culprit is in the posting."

Sagcal said the posting of certificates of payment should have been verified against the remittance reports of the government agencies in order to make sure that both numbers tallied and all contributions would be property accounted for in the GSIS books.

Garcia, however, said he did not know which government agencies have not remitted their contributions and which were unaccounted for or which contributions were actually booked.

"We have to reconcile our records. These things have to be verified," he said.

Finance Secretary Jose Isidro Camacho said the GSIS has been under investigation since the first complaints reached the authorities.

He said the Department of Finance (DOF) has already submitted its recommendations to the Office of the President for action.

Camacho, however, declined to disclose the contents of the recommendation, saying only that the investigation and review of GSIS operations have identified " a number of problems" that led to the delays in the release of pension payments and the suspension of salary loans to government employees.

Meanwhile, Garcia has instructed GSIS offices all over the country to open their doors to a productive interface with representatives and members of other government employee organizations.

"It is probably a shortcoming that the moves and decisions made to improve not only the financial condition of the GSIS but also the level of service efficiency off all GSIS offices were not fully and widely publicized for each and everyone’s standing," he said.

He said that what he is doing today is for the long term viability of the GSIS fund and permanent improvements in processing systems.