MANILA, Philippines — The Commission on Audit (COA) has scolded the state-run Nayong Pilipino Foundation Inc. (NPF) for depleting its trust funds intended for the development of a property in Parañaque City without any notable accomplishments.
In its 2021 annual audit report on the NPF, the audit body noted that for the past four years (2018 to 2021) the state firm’s management has already withdrawn a total of P475.6 million from its P1.232-billion Trust/Investment Fund.
The sum was earmarked for the development of its 5.43-hectare property in Parañaque, but with a balance of only P754.682 million left as of Dec. 31, 2021, the NPF has little to show.
Based on the COA’s record, the trust/investment fund represented the advance payment made by Resorts World Bayshore City Inc. (RWBCI) in 2014, in connection with the lease contract that the NPF entered into with the latter for the development of the new Nayong Pilipino Cultural Park in Manila Bay in Parañaque.
The COA said the NPF’s withdrawal rate translates to an average of P118.9 million per year, but the records showed that the withdrawals were mainly for the firm’s “general, administrative and support expenses” and not for purposes for which the fund was earmarked.
The COA warned that if the NPF would not improve its fiscal management and introduce any revenue-generating measures to support its general operations, it will be out of funds six or seven years from now, especially as the amortization schedule based on the lease agreement with RWBCI shows that the next payment will be in 2035.
“It is also worth emphasizing that once the construction of the NPF Park in Parañaque City commences, the funds would further be depleted, thus compounding the funding problems of NPF,” the COA said.
“Nevertheless, despite continued depletion of funds and lack of sources of revenues, NPF Management has yet to introduce programs and/or detailed plans to mitigate the impact thereof,” it added.
In the same audit report, the COA noted that the fund allocated by the NPF for the implementation of its programs, activities and projects (PAPs) for 2021, amounting to P22.5 million, only represented 15 percent of its total budgeted expenditures for the year.
The COA noted that of the P22.5-million budget for the PAPs, only P7.5 million was actually spent by the NPF, representing 14 percent and 7 percent of its total Maintenance and Other Operating Expenses (MOOE) and total Current Expenses, respectively.
“These would show that the resources of NPF were heavily allocated to administrative and support expenditures rather than on the PAPs in furtherance of NPF’s mandated purposes and objectives,” the COA said.
Under the Presidential Decree No. 37, which created the NPF, among the primary mandate of the Foundation is to construct and maintain parks and recreation centers for the promotion of tourism, as well as libraries, laboratories and educational accessories for research of all kinds including in the field of social sciences and humanities.
The COA recommended to NPF to conduct a long-term financial planning and devise “detailed and realistic plans to address the depletion of funds.”
The COA said the NPF must also revisit its annual operating expenses to “introduce austerity measures as well as eliminate unnecessary functions/cost centers to accommodate more PAPs for the attainment of [its] mandated functions.”
In a reply, the NPF management said it will organize “several planning sessions” which aim to address the audit recommendations.