Over P.6M “illegal” expenses found

CEBU, Philippines - The Commission on Audit uncovered over P600,000 worth of “irregular expenditures” by the members of the board of the Mactan Cebu International Airport Authority (MCIAA).

State auditors said these expenses were personal in nature but were charged against government funds.

COA-7 director Sabiniano Cabatuan said they found several deficiencies in the reimbursement vouchers submitted by the members of the MCIAA Board. He said the receipts submitted for reimbursements show that these were mere compilation of personal receipts to come up with the P30,000 equivalent to the monthly honorarium of each board member.

Each of the MCIAA board member is entitled to a P30,000 honorarium every month (P15,000 per meeting) before the election of President Benigno Aquino, III. The board meets twice a month.

The policy however was amended when Aquino issued the Executive Order 24 on February 10, 2011 prescribing rules governing the compensation of members of the board, which prohibits ex-officio members, including alternates from receiving any additional compensation from their services.

MCIAA Board is composed of the Secretary of the Department of Transportation and Communications (DOTC) who sits as chairman and some other secretaries of the various government agencies as members.

Undersecretaries usually sit as alternate members  to the board and also collect honorarium.

The agencies that composed the MCIAA Board are the Department of Tourism, Department of Justice, Department of Finance, Civil Aviation of the Philippines, four private sector representatives, the governor of Cebu and the MCIAA general manager.

Instead of the regular compensation, the president allowed reimbursement in the “exigency of the service.”

Reimbursements allowed by the President include transportation expenses in going to and from the place of meetings, expenses during official travel, communication expenses and meals during business meetings in relation to their duties and function in the board.

However, COA found out that reimbursements were being abused by some members  of  the board.

According to the state auditors, about P642,049 of the total reimbursements paid is considered irregular expenditures. It includes meals or snacks that were served to only one person thus there was no meeting to speak of to justify the incurrence of the expenditures.

  “Even petty expenses such as a cup of coffee and two scoops of ice cream were charged against government funds,” the COA report read.

“Meals were sometimes purchased as take out in drive thru or even delivered to some residential addresses and several receipts for meals or foods were purchased on Saturdays and Sundays, which are normally the days spent for personal or family gatherings,” COA noted.

There were some expenses for meals and foods that were charged against the credit cards of persons other than the ex-officio member of the MCIAA Board who claimed for reimbursement.

Other reimbursement for meals and gasoline expenses were incurred outside Manila to places such as Batangas, Boracay, Laguna and some other places, while reimbursements for airfares from Manila to Caticlan and back were also reimbursed against MCIAA funds.

According to COA, since most of the members of the MCIAA Board are high-ranking officials they are either receiving monthly transportation allowances or provided with government vehicle in their mother agency.

What is more alarming, COA said, is the fact that there were gasoline expenses already paid for in the mother unit of one of the ex-officio members of the MCIAA Board but was again presented and reimbursed thus resulting in double-payments.

MCIA general manager Nigel Paul Villarete said this could be impossible because at the MCIAA they will not accept requests for reimbursement unless these are supported with official receipts.

Some members of the MCIAA Board requested for reimbursements for expenses even during the months that they failed to attend the bi-monthly meetings of the board, while there were purchases of groceries from a Japanese store that were passed off as meals during business meetings.

COA said there were also requests for reimbursement on SPA services and communication expenses on accounts that are not under the MCIAA.

 “It appeared that all throughout the days of the months, expenses for meals, food, gasoline and others were invariably incurred and paid for by some ex-officio members of the board thus violating the provision of Executive Order 24,” COA said.

MCIAA officials insisted that their expenses were really incurred in the performance of their functions.

“These ex-officio members of MCIAA board are not only members during board meetings, but they are also performing regular functions as ex-officio member by attending to meetings, planning discussions, meetings with investors, coordination with the undersigned and fellow members all in the interest of MCIAA. Dili diay mahimo ang meeting nga adto sa balay?” Villarete said.

Former DOTC Undersecretary Aristotle Batuhan, whose name is among those mentioned in the report, said they will make a collective stand about the issue by reimbursing the government with the amount they received if there is an order from the court.

“Kon dunay order sa court nga pabayron mi sa kantidad nga among nadawat andam kami nga mouli (If there is an order from the court for us to reimburse the amount, we are more than willing to return it),” Batuhan told The FREEMAN yesterday.

Villarete said they will ask for a more definite explanation on what are the specific expenses that can be charged for reimbursement  and will issue supplemental guidelines to strengthen the Internal Control of these types of disbursements.

COA explained that Executive Order 24 does not give blanket authority to ex-officio members of the MCIAA Board to reimburse the expenses by just mere presentation of any kind of receipts.

“To do so would certainly be just the circumvention on  the prohibition against ex-officio members of the board being entitled to allowances.”

Meanwhile, state auditors said that the granting of  the Collective Negotiation Agreement (CNA) bonus to all officials and employees of the airport is still considered irregular because of some procedural defect that is yet to be corrected.

The CNA entered into by the employees and the MCIAA is reportedly unregistered with the Civil Service Commission until now. Executive Order 180 requires all CNA to be registered with the CSC before any bonus could be granted.

MCIAA officials however argued that nowhere in the EO that the CNA benefits of the employees shall be forfeited in case of its non-registration. COA said the requirement as provided for in the procedure should be complied with.

COA said the granting of the benefit should be stopped until after the requirements are complied with.

The state auditors also considered a waste of government funds the P49.5 million initial payment made by the MCIAA for the construction of the airport’s administration building which started in 2006. The construction was suspended and the structure remains unusable until now.

The record shows that in 2007, the construction of the building was suspended after the MCIAA Board created its own audit team to undertake a construction audit tasked to look into the issues about its legality, ownership of the lot where the building was constructed and the technical aspect.

It was agreed then that the construction project will be completed after the resolution of the issues, but even the lapse of five years, the audit team failed to submit any report of their findings.

When the COA engineers inspected the unfinished construction project of the airport they found out that some structural details of the building plans are not consistent with the actual construction.

MCIAA officials have been requested by COA to resolve the issue as soon as possible to protect the interest of the government.  (FREEMAN)