Palace on gravy train: Wrong, unfair

Malacañang dismissed yesterday a report by the Philippine Center for Investigative Journalism (PCIJ) that the Palace distributed largesse to congressmen in exchange for the dismissal of the impeachment complaint against President Arroyo.

Press Secretary Ignacio Bunye insisted that "truth and moral sense" drove members of the House of Representatives to junk the impeachment case against Mrs. Arroyo and not bribes sourced from the President’s Social Fund (PSF).

"This report linking disbursements of the PSF to the impeachment is wrong, misplaced and unfair," Bunye said, stressing the fund "is disbursed under strict rules, officially audited and applied to specific purposes for the public good.

"These matters are open to public scrutiny and if there are violations of law based on evidence, they will be prosecuted," he added.

Bunye maintained the Palace did not use money to help the House members become "enlightened" in voting against the impeachment complaint.

The PCIJ reported that the President issued postdated checks to support the pet projects of favored legislators, although this is not allowed in government.

The checks were released from the PSF, also known as the President’s "pork barrel." The fund was created by a Marcos decree that required the Philippine Amusement and Gaming Corp., or Pagcor, to remit its earnings to support the President’s development projects. According to the Commission on Audit, the fund stood at P1.16 billion as of Dec. 31, 2004.

Among the recent releases from the PSF were supposedly three postdated checks, each worth P5 million, that were sent to the Department of Education in late August by no less than the Presidential Management Staff.

One of the recipients was supposedly Zambales second district Rep. Antonio Magsaysay Diaz, who himself stated in his letter that P5 million, the first tranche of the P20 million promised by the President to help with his scholarship program, was released last Aug. 21, a Sunday and a non-working day.

The release came two days after the House justice committee closed debates on the three impeachment complaints and two days before it was to resume hearings to address "prejudicial questions" and vote on the supposedly proper complaint. In the end, the committee decided to act only on the original complaint filed by lawyer Oliver Lozano, but threw it out for insufficiency in substance.

Last Sept. 6, Diaz was among the 158 House members who voted to adopt the House justice committee report junking the Lozano complaint.

Another supposed recipient was Zamboanga del Sur Rep. Isidoro Real Jr., who, like Diaz, voted yes on dismissing the complaints and explained to his colleagues that the President helped his province.

The Malacañang source of PCIJ said the Office of the President issued to other government agencies checks that were really intended for the congressmen, and was frantically coordinating with the accounting units of these agencies on how to transfer the sums to the legislators and their projects.

But up to now, the DepEd central office has yet to transfer Diaz’s first P5 million to the Zambales schools division. Neither has the department given in to Malacañang’s escalating pressure to sign the receipt for the three postdated checks.

PCIJ said education officials, who have repeatedly asked to be "insulated from politics" amid the political crisis hounding Mrs. Arroyo, were objecting to the Palace’s move to use DepEd and other agencies to cover the money trail from Malacañang to the congressmen.

"This is clearly laundering. DepEd is being used to launder the money for the congressmen," a DepEd official said.

The official also said DepEd would be violating government accounting practice by accepting the postdated checks issued by the Palace. In business, the issuance of postdated checks is a common practice. Postdated checks are used to ensure collection and to pay debts, among other purposes. These serve as guarantees of payment.

A senior state auditor said there were no rules prohibiting postdated checks in government "because there is no transaction of this nature in government," adding that it was quite abnormal for the President to release funds from the PSF through postdated checks.

Accountability is another major reason the DepEd has refused to cooperate with either Diaz or Malacañang. "There would be no accountability at all. Diaz does not officially appear as the recipient. How do we liquidate the amount? How can we compel him to liquidate? What do we tell COA (the Commission on Audit)?" the DepEd official said.