National Treasurer calls for law separating Malampaya fund from general funds

National Treasurer Rosalia de Leon INQUIRER FILE PHOTO

MANILA, Philippines—National Treasurer Rosalia de Leon said the law governing the use and treatment of the controversial Malampaya Fund should be revisited.

De Leon—who, together with two other economic officials, has been named a respondent to graft and malversation charges in relation to the Malampaya Fund—said the existing law has allowed money composing the Malampaya Fund to be co-mingled with all the other revenues generated by the national government.

In light of views that the Malampaya Fund — composed of royalties earned by the government from the natural gas project in Palawan — should be accounted for separately from the government’s general funds to enhance transparency, De Leon said lawmakers should consider amending the law.

She suggested an amendment that would specifically require separation of the Malampaya Fund from all the other revenues of the government.

“The law should be revisited,” De Leon said Wednesday in a chance interview.

She said the charges against her and her colleagues were unfounded because the existing law on the Malampaya Fund, Presidential Decree 910, had no provision requiring the separation of the Malampaya Fund from the government’s general funds.

The national government has been operating on a budget deficit since the late 1990s. This means that since then, the government’s total revenue collection for any given year had always been short of its annual expenditure requirements, thus forcing it to partly rely on borrowing to support its operations.

In a hearing on the national budget in 2013, Sen. Ralph Recto explained that because of the government’s practice of co-mingling the Malampaya Fund with the government’s general funds–and because the government operated on a budget deficit–there was no longer actual cash to speak of.

The legislator then proposed an amendment of the law to make the handling of the Malampaya Fund stricter.

Besides De Leon, the two other respondents to the graft and malversation charges were Budget Secretary Florencio Abad and Finance Secretary Cesar Purisima.

The case was filed by public-interest advocate Louis Biraogo.

In his complaint, Biraogo said De Leon, Purisima, and Abad were guilty of graft and malversation of public funds because they either failed to account for the Malampaya Fund or to prevent its “misuse.”

Biraogo claimed that co-mingling of the Malampaya Fund was illegal, noting that that law requires that it to be used solely for energy-related projects.

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