EU suspends funding aid to Mindanao peace NGO

DAVAO CITY, Philippines – The European Union (EU) has temporarily suspended its funding assistance to the Mindanao People’s Caucus (MPC), a non-government organization involved in peace efforts in Mindanao, pending investigation into “potential ineligible costs” in the group’s projects.

In a letter dated Sept. 25, Willem Verpoest, contracts and finance head of the EU Delegation to the Philippines, informed MPC head Mary Ann Arnado that EU auditors have found “a number of potential ineligible costs” during a recent financial audit on a number of the NGO’s projects.

However, it was not clear as to the amount of these “ineligible costs.”

The STAR tried to get in touch with Arnado, but she only sent a staffer, one Candido Aparece, to explain the situation.

Aparece said the EU has instructed the MPC not to talk to the media, as the matter on the audit was internal.

But Aparece confirmed that indeed an audit took place sometime last August and that the letter, a copy of which The STAR got hold of, really came from Verpoest.

Aparece declined to comment further on the matter.

“You will appreciate that the high level of these potential ineligible costs does not allow us to consider, for the time being, further funding of the MPC in the framework of the above mentioned new 2012 program,” Verpoest said in the letter to Arnado.

Verpoest said that in view of the urgency and the current developments in the peace process, EU plans to sign a contract with the Non-Violent Peace Force as soon as possible without the MPC component.

The Non-Violent Peace Force, which is based in the United States and Belgium, is an NGO in a special consultative status with the economic and social council of the United Nations.

“I wish to emphasize that the decision to no longer fund MPC for the time being is a purely technical decision based on our contractual and financial procedures. It does not compromise at all your outstanding efforts and role in the peace process in Mindanao,” he added.

Verpoest, however, said the funding could still be resumed if the MPC satisfies all the questions of the EU investigating team.

If not, he said the EU “will close contract 2010/254-405 and not consider any costs incurred after the final date of implementation of this contract (May 25, 2012).”

The suspension of the funding assistance to the MPC came as the EU has adopted a new grant program amounting to nine million euros (P460 million) to further support the peace process in the south.

The new assistance was prompted by the adoption of the “Decision Points on Principles” by the government and the Moro Islamic Liberation Front peace panels last April.