Arsenio M. Balisacan, former NEDA director general and now Philippine Competition Commission chair (File photo from Philippine Daily Inquirer)
The Commission on Audit (COA) has ordered Arsenio Balisacan, former National Economic and Development Authority (NEDA) director-general, and other officials of the agency to return to the government P73.64 million in employee incentives unlawfully granted from 2010 to 2012.
In a six-page decision, the commission proper also directed its Prosecution and Litigation Office to forward the case to the Office of Ombudsman for investigation and the filing of appropriate charges against the officials.
COA said NEDA’s grant of the cost economy measure award (CEMA) – a reward for personnel who propose time-saving measures – was not reviewed by the Department of Budget and Management nor was it approved by the President.
“All told, the grant of CEMA is not clothed with authority, considering that it lacked review by the DBM and the eventual approval by the President. Hence, its disallowance is proper,” read the decision.
NEDA officials argued the grant of incentives was anchored on Civil Service Commission Memorandum Circular No. 1, series of 2001, but COA said it was “not absolute and plenary, particularly on the implementation of benefits.”
Implementation of the incentives program “has to be coordinated or harmonized with other relevant laws,” such as Presidential Decree No. 1597, which required the DBM review and the President’s approval.
Besides the failure to secure the DBM and the President’s authorization, COA noted that NEDA Office Circular No. 03-2005 did not even set the criteria for entitlement to the incentive.
While NEDA said it managed to meet or exceed its target accomplishment despite only having 64 percent of the manpower requirement, COA said it did not specify or quantify how man-hours and costs were saved with sufficient evidence.
The payment of CEMA was also not supported with a specific appropriation from the annual financial budget. Instead, the awards were sourced from the savings, such as those from NEDA’s maintenance and other operating expenses (MOOE).
The realignment of MOOE to its personal services expenses in 2012 violated Section 56 of that year’s General Appropriations Act, which required also required the prior approval of the DBM.
This violation of the law could give rise to possible criminal or administrative liabilities which the Ombudsman could look into, COA said.
Meanwhile, ordinary personnel were held in good faith and cleared of liability, because they “had no participation whatsoever in granting the CEMA Incentive or were mere passive recipients.”
Besides Balisacan, who now chairs the Philippine Competition Commission, COA also held the following liable for approving the transaction: Deputy Director-General Nestor Mijares IV, infrastructure staff director Librado Quitoriano and legal staff officer-in-charge Romeo Telpo.
Balisacan’s predecessor, former Director-General Cayetano Paderanga Jr., was also held liable, but he passed away in January 2016.
Also held liable were the certifying officials: administrative services officer-in-charge Joseph Melvin Basas, chief accountant Lilinda Pascual, assistant director Arturo Cebuma Jr., accounting service officer-in-charge Duane Ceniza, chief administrative officer Virginia Atenta and financial services officer-in-charge Susanna Santos.
In a separate four-page decision, COA also affirmed the disallowance of the P160,200 CEMA paid to the personnel of Legislative-Executive Development Advisory Council Secretariat also from 2010 to 2012.
While the LEDAC Secretariat personnel were also held in good faith as “mere recipients,” COA required the NEDA officials who approved the grant of the incentives to refund the amount too.
As in the case of the incentives for NEDA personnel, COA also held Mijares, Basas, Telpo, Pascual, Santos and Atenta liable for the LEDAC Secretariat employees’ CEMA.
Also held liable were acting legal staff director Jocelyn Reyes, accountant Ana Abigail Soriano, and supervising economic development specialists Baby Catherine Cruz and Jeson dela Torre.
“The approving NEDA officials are solidarily liable to return the disallowed funds even if they never got hold of them,” COA said. /atm