Palace letter sets off Malampaya plunder

SOURCE OF GAS WEALTH The Malampaya gas rig is found 80 kilometers off the shore of northwest Palawan. INQUIRER PHOTO

The release of P900 million from the Malampaya Fund to the Department of Agrarian Reform (DAR) had already been “fixed” even before officials asked for quick response money from Malacañang on the pretext that farmers needed livelihood kits to recover from the damage wrought by Storms “Ondoy” and “Pepeng” in 2009, the Inquirer has learned.

These allegedly overpriced livelihood kits to farmers were just a ruse deployed by fake nongovernment organizations (NGOs) owned by detained businesswoman Janet Lim-Napoles to access the Malampaya Fund sought by then Agrarian Reform Secretary Nasser Pangandaman from then President Gloria Macapagal-Arroyo.

A letter issued by the then “little president,” Executive Secretary Eduardo Ermita, provided state agencies like the DAR the green light to dip into the Malampaya Fund which eventually led to a total of P14 billion released by the Arroyo administration just a few months before the 2010 elections.

“This pertains to the Oct. 13, 2009, letter of Executive Secretary Eduardo Ermita relative to the approval of the President (Arroyo) to use Special Account in the General Fund (Fund 151) of the Department of Energy in such amounts as may be necessary for the relief operations, rehabilitation, reconstruction, and other works and services to areas affected by natural calamities,” then Budget Secretary Rolando Andaya said in a memo to the Office of the Treasurer approving the P900-million allocation to the DAR.

Andaya previously told the Inquirer that Arroyo approved the use of the Malampaya Fund, the access of which was restricted by law for energy-related projects, during a series of Cabinet-level meetings.

Ermita’s letter came nine days before then Agrarian Reform Undersecretary Narciso Nieto formally requested for a P900-million budget “to provide directly to our farmer-beneficiaries the necessary inputs to help them recover from their losses ” in a letter to Andaya dated Oct. 22, 2009.

“Based on our past experiences, we realized that providing the farm communities the means to do this would be the best way to help them accelerate recovery from these two calamities,” said Nieto, who placed the damage to communities of agrarian reform benefiaries from Ondoy and Pepeng at P10 billion.

A DAR officer, who refused to be named for fear of reprisal, said that Nieto had to pinch-hit for Pangandaman who was then in the United States, because the department wanted the money released before the end of the year.

The special allotment release order (Saro) for the P900-million fund was issued by Andaya on Nov. 19, 2009, with the notice of cash allocation (NCA) released to Land Bank of the Philippines, Quezon Circle branch, a little over a month later on Dec. 21.

Cash before Christmas

Based on the liquidation report obtained by the Inquirer, the checks for roughly 90 percent of the DAR funds were dated between Dec. 22 and 23 which allowed Napoles’ staff to withdraw the money before Christmas 2009.

Whistle-blowers Benhur Luy and Merlina Suñas said these withdrawals were among their single biggest haul in their years of working under Napoles.

Curiously, the checks for the balance of the remaining 10 percent were dated Nov. 25 and were taken from the DAR’s general funds.

The DAR official said the fund releases comprised one of the biggest lump sums received by the agency and were rare since it did not handle quick response funds for typhoons.

The official said that the DAR knew that these funds were intended for the 12 Napoles NGOs even before they received the Saro and the NCA because their officers had been religiously following up the release with the agency’s staff.

Suñas claimed in recent interviews that she took the names of the local government beneficiaries from the list of towns hard hit by Ondoy and Pepeng.

The livelihood packages were labeled farm initiative production kits or agricultural production equipment that were valued in the memorandum of agreement at either P38,118 or P42,358 each.

Luy and Suñas claimed that none of the equipment reached the listed beneficiaries.

Based on the liquidation report, the NGOs and amounts received were Abundant Harvest for People’s Foundation Inc. led by Vanessa Eman (P75 million); Bukirin Tanglaw Foundation Inc. led by Gertrudes Kilapkilap (P75 million); Dalangpan Sang Amon Utod Kag Kasimanwa Foundation led by Jesus Castillo (P75 million); Ginintuang Alay sa Magsasaka Foundation Inc. led by John B. Lim (P77.5 million); Gintong Pangkabuhayan Foundation Inc. led by Eulogio D. Rodriguez (P82.5 million);

Karangyaan para sa Magbubukid Foundation Inc. led by Simplicio Gumafelix (P82.5 million); Kasaganahan para sa Magsasaka Foundation Inc. led by Genevieve Uy (P75 million); Kaupdanana para sa Magsasaka Foundation Inc. led by John Raymund de Asis (P75 million); Masaganang Buhay Foundation Inc. led by Ronald Lim (P55 million); Saganang Buhay sa Atin Foundation Inc. led by Lilian Espanol (P80 million); and Tanglaw para sa Magsasaka Foundation Inc. led by Nova Kay B. Dulay (P62.5 million).

COA inquiry

The Commission on Audit (COA) is investigating disbursements amounting to P23.6 billion from the Malampaya Fund by the Arroyo administration, 60 percent of which were released during a spending binge before the May 2010 presidential election.

Andaya earlier told the Inquirer that as the budget secretary, he and his undersecretary, Mario Relampagos, signed more than 150 Saros covering P14 billion between Oct. 21 and Dec. 29, 2009, ostensibly for the victims of the back-to-back storms that killed more than 1,000 people.

Upon orders of Arroyo

Now a Camarines Sur representative, Andaya said that funds were released upon the orders of Arroyo during a series of Cabinet meetings, but he maintained all of the disbursements were above board.

The COA review of the Malampaya Fund is separate from the special audit on the Priority Development Assistance Fund (PDAF), or pork barrel, results of which have led to the filing of plunder and malversation charges against three senators, five congressmen and 30 other officials of state agencies and NGOs.