Tugade may face legal troubles over P40-B unspent funds

MANILA, Philippines – Transportation Secretary Arthur Tugade could face legal troubles for his move to transfer more than P40 billion in unspent funds of his department to another agency under it to make it appear the department was efficiently using its budget, senators warned yesterday.

During plenary deliberations on the proposed P53.9-billion budget of the Department of Transportation (DOTr) for 2017 last week, it was disclosed that the agency has unspent funds amounting to P19.2 billion from its 2015 budget and a whopping P23.6 billion for 2016, equivalent to almost half of the funding it is asking for next year.

Upon questioning from Sen. Grace Poe, Tugade – through Sen. Loren Legarda, chair of the Senate finance committee and defender of the DOTr budget – said the unspent funds were downloaded to the Civil Aviation Authority of the Philippines (CAAP) and the Philippine Ports Authority.

Legarda said the downloaded funds were considered obligated so the DOTr would not revert it back to the National Treasury.

“It can also be spent next year so they have P23 billion from present year’s budget continuing until next year, they (DOTr) have P19.2 billion next year because they allocated it again… So they have two, they have so much funds,” Legarda said.

But the move to transfer the funds did not also sit well with Senate Minority Leader Ralph Recto.

Recto said it was irregular and the monies could not be considered automatically obligated.

Recto hit what he said was an emerging bad habit among agencies to transfer their allocations to other agencies and then report such transactions as fund utilization.

In the case of the DOTr, he said, this is the scheme resorted to in its unused budget for airport improvement, through an 11th hour delegation of funds to CAAP in a bid to beat the two-year expiry date of the appropriations.

“The rule ought to be this: agencies must spend the buck and not pass the buck. Transferring funds to another government agency is not fund utilization. It is not procurement but an accounting trick to prettify the books in order to give out a glowing report card,” Recto said.