LWUA execs ordered to refund P75-M perks

The Commission on Audit (COA) has ordered executives of the Local Water Utilities Administration (LWUA) to return P74.56 million in unlawfully granted employee benefits during the Aquino administration.

In three recently released decisions dated Oct. 25, the COA denied the petitions for review filed by LWUA Administrators Andres Ibarra and Eduardo Santos on the five notices of disallowance (NDs) issued by state auditors from September 2013 to April 2015.

In the first decision, the COA directed its Prosecution and Litigation Office to forward the case to the Office of the Ombudsman for investigation and the filing of appropriate charges.

Meal allowances

LWUA’s board of trustees continued to grant meal allowances above the monthly ceiling despite the repeated issuance of audit observation memorandums that flagged the violations of the Salary Standardization Law and Letter of Implementation No. 97, the COA said.

It added that Ibarra’s appeal on the disallowance of P14.28-million meal allowance was filed beyond the 180-day period, making the ND final and executory.

The second decision also dismissed Santos’ petition for being filed out of time. It also noted that the LWUA board had no authority to grant P29.78 million in meal allowances and hospitalization benefits without prior approval of the President.

Hospitalization benefits

Hospitalization benefits, notably, have been integrated already into the basic salary of government employees under the Salary Standardization Law.

Lastly, the third decision continued to hold the higher officials of LWUA liable for P30.5 million in meal allowances and hospitalization benefits, while clarifying that “passive recipients”—ordinary employees—were not required to refund the amounts they were paid.

Practice since 1980

The COA held ordinary employees to be in good faith due to a lack of indication that they participated in the deliberation or were privy to the internal affairs regarding the LWUA board’s approval of the benefits.

But, it did not give credence to the approving officers’ contention that the grant of meal subsidies had been a practice since 1980 at the earliest and that doing away with it would violate the principle of nondiminution of pay.

Citing the Supreme Court’s 2002 Baybay Water District ruling, the COA said LWUA could have stopped following the supposed practice because an established practice arising from the erroneous enforcement of law can still be corrected.