Published: Thu, January 16, 2014

Pag-IBIG, PCSO execs: Fund releases were legal

By Joyce Ilas Two government-owned and controlled corporations (GOCCs) told Solar News on Tuesday that their disbursements, which are being questioned by the Commission of Audit (COA), were all allowed by the law. According to a COA report, the following GOCCs paid bonuses, allowances, and benefits to members of their board of directors and employees that were excessive or without legal basis:

Philippine Health Insurance Corp. (PhilHealth) - P1,651,084,000 Development Bank of the Philippines (DBP) - P216,801,000 Region 7 Water Districts - P186,584,000 Philippine Charity Sweepstakes Office - P54,829,000 Philippine Economic Zone Authority - P48,500,000 Home Development Mutual Fund - P37,636,000 Butuan City Water District - P28,243,000 Development Academy of the Philippines - P23,838,000 Philippine National Oil Co. Exploration Corp. - P14,518,000 Mactan-Cebu International Airport Authority - P14,406,000

COA had earlier asked officials and employees of 31 GOCCs to return to the government their bonuses and allowances in 2012, saying the release of the amounts was unauthorized. Among these GOCCs was the Home Development Mutual Fund, or Pag-IBIG Fund. But Pag-IBIG Chief Executive Officer Darlene Berberabe, insisted that all disbursements her agency made were authorized under existing laws. She also clarified that the more than P37.5 million disbursement that COA disallowed were not bonuses but were part of early retirement packages given to employees. Berberabe added tha the Pag-IBIG Fund early retirement package could not be considered as double-retirement compensation, as mentioned in the COA report. Some Pag-IBIG Fund employees applied and received the agency's early retirement package before getting another retirement package from the Government Service Insurance System (GSIS). Berberabe said what should be questioned is the grant of a retirement package by the GSIS not Pag-IBIG's. Under the GOCC Governance Act of 2011 all modes of compensation for government employees should be approved by the Governance Commission on GOCCs. But Berberabe explained that Pag-IBIG's charter was approved in 2009, and that it was among the three GOCCs exempted from the new law. She said Pag-IBIG would move for a reconsideration of the notice of disallowance. Likewise, the PCSO said its almost P55 million worth of allowances and bonuses being questioned by COA is allowed under the law. PCSO General Manager Jose Ferdinand Rojas II detailed how the P55 million was disbursed:

More than P25 million was given as weekly draw allowances for those manning the daily lottery draw. About P24 million went to the employees' cost of living allowance. More than P2 million was paid to the board of directors for their per diem differential More than P1 million went to other allowances.

Rojas said, however, that the cost-of-living allowance and the benefits and allowance of the PCSO board of directors had already been discontinued, starting in 2012. This is the third time COA had called the attention of the PCSO over its use of funds. But should COA finally rule that their disbursements were illegal, Rojas said the board of directors and their employees would be willing to return the money to the national coffers through salary deductions. Share on facebook Share on twitter Share on email Share on print More Sharing

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Published: Wed, January 15, 2014

GOCCs stand pat in face of COA disallowances

By Joyce Ilas

Several government-owned and controlled corporations (GOCC) say their disbursements being questioned by the Commission of Audit (COA) were all allowed by law.

COA earlier asked officials and employees of 31 GOCCs to return to the government their bonuses and allowances in 2012, saying the release of the amounts was unauthorized.

Based on the COA report, these GOCCs paid bonuses, allowances and benefits to members of their board of directors and employees that were excessive or without legal basis.

Among these GOCCs was the Home Development Mutual Fund, or Pagibig Fund.

Pagibig Chief Executive Officer Darlene Berberabe, however, insists that all disbursements that her agency made were authorized under existing laws.

She also clarifies that the more than P37.5 million disbursement that COA disallowed were not bonuses but were part of early retirement packages given to employees.

Berberabe adds that the Pagibig early retirement package can not be considered as double retirement compensation as mentioned in the COA report.

Some Pagibig fund employees applied for, and received, the agency's early retirement package before obtaining another retirement package from the Government Service Insurance System.

Berberabe points out that what should be questioned is GSIS' grant of their retirement package, not PAGIBIG's.

Under the GOCC Governance Act of 2011, all modes of compensation for government employees should be approved by the Governance Commission on GOCCs.

But Berberabe explains, Pagibig was among the three GOCCs exempted from the new law, and so, would move for a reconsideration of the notice of disallowance.

Likewise, the Philippine Charity Sweepstakes Office (PCSO) says its almost P55 million worth of allowances and bonuses being questioned by COA was allowed under the law.

Jose Ferdinand Rojas II, PCSO General Manager, points out that there was an approval from the Office of the President. The charter of PCSO states that compensation of its board of directors is under the Office of the President.

Rojas says that, of the P55 million, more than P25 million was given as weekly draw allowances for those manning the daily lottery draw, and about P24 million went to the employees' cost of living allowance (COLA). More than P2 million was paid to the board of directors for their per diem differentials, and more than P1 million went to other allowances.

Rojas clarifies, though, that the PCSO COLA and board of directors' benefits and allowance have already been discontinued since 2012.

This is already the third time COA called PCSO's attention over its use of funds.

But if COA finally rules that their disbursements were illegal, Rojas says, the members of the board of directors and their employees are willing to return the money to the national coffers via salary deduction.

http://www.solarnews.ph/news/2014/01/15/goccs-stand-pat-in-face-of-coadisallowances#.UveS8L2wrIU

2013 national budget: Big bonuses await productive government workers By Michael

Lim Ubac

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Budget Secretary Florencio Butch Abad. INQUIRER FILE PHOTO

State employees and officials will be among those who will benefit from the biggest national budget ever proposed by a sitting president to Congress.

The General Appropriations Act (GAA) for 2013, which will be transmitted to Congress a day after the state of the nation address (Sona) of President Benigno Aquino on July 23, allots some P9 billion to P10 billion for the performance-based incentives of the one million-strong bureaucracy. Malacaang hopes the performance-based incentive system will strengthen accountability and encourage productivity in state agencies. In a press conference, Budget Secretary Florencio Butch Abad said the Aquino administration was working to harmonize all performance management systems in government and to deepen performance -based budgeting. The performance scheme will reward agencies and public servants who meet and even surpass their performance targets. If approved, the first wave of performance bonuses will be granted in early 2013, with amounts ranging from P15,000 to P35,000, depending on an employees productivity. The performance bonuses will be on top of their existing productivity enhancement incentive bonuses which are sourced from the savings of individual agencies. Abad said the incentive and bonus systems of government-owned and -controlled corporations (GOCCs) will also be streamlined due to abuses in the past. According to the budget chief, the Governance Commission for GOCCs (GCG) are in the process of preparing an incentive system for GOCC employees, which will be separate from the performance-based system of national government agencies. He noted that President Aquino had cited the situation at the Metropolitan Waterworks and Sewerage Administration, the Local and Water Utilities Administration, among other agencies, where they really abused the use of government funds to grant themselves so many allowances and bonuses that actually had no legal basis. Abad said the GCG was now reviewing these allowances, and limiting them to what was authorized under an existing executive order. The proposed P2-trillion national budget for 2013 is 10.5 percent higher than the P1.816-trillion budget for the current fiscal year. With Ronnel W. Domingo Originally posted: 8:37 pm | Tuesday, July 10th, 2012

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Govt pay review may be neededRecto By Norman

Bordadora Philippine Daily Inquirer

5:27 am | Sunday, August 4th, 2013
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Senate President Pro Tempore Ralph Recto: We may end up with no one warning us of incoming typhoon. INQUIRER FILE PHOTO

MANILA, PhilippinesIf the new appropriation for hazard benefits proposed in the P2.26-trillion 2014 national budget isnt enough to keep the countrys weather men from leaving for better pay abroad, it may be time to review the governments salary structure, Sen. Ralph Recto said Saturday. Recto, the Senate President Pro Tempore, said the proposed budget for next year already provides for substantially increased hazard pay for civilian government employees and hiked benefits under the Magna Carta for Science and Technology. He also mentioned four new appropriations for hazard and hardship benefits. At the rate weather forecasters are leaving the Philippine area of responsibility, we may end up with no one alarming us that a typhoon is coming, Recto said. Recto, also the chair of the Senate committee on science and technology, made the statement after another forecaster, Ricky Fabregas, was reported to have left the weather bureau Pagasa to accept a P100,000-a-month job in the Congo. If the problem is in the delay of the release of the benefits of Pagas a people, then I am confident that the [Department of Budget and Management], being the main preacher of the gospel against red tape, will resolve it soonest, he said. Recto said the 2013 budget provided for P51.8 million in hazard pay for government personnel outside the uniformed services and P183.7 million in benefits under the Magna Carta for Science and Technology. He added that under the proposed 2014 budget, the benefits would increase substantially with the total allocation for hazard pay rising to P832 million and the Magna Carta for Science and Technology benefits up to P224.6 million. The good news is that four new hazard and hardship allowances for civilian employees have been created in the 2014 budget, Recto said.

He said the 2014 budget provides for an allocation for hazard-duty pay at P1.3 billion; high-risk duty pay, P893,000; hazardous-duty pay, P586 million; special-hardship allowance, P1.17 billion. I think the restructuring and right-sizing of the hazard-pay allocations stem from the redefinition of what constitutes a hazard. And the creation of different shades of hazard pay should be welcomed by those in high-risk jobs, Recto said. Thus I hope that the perennial compensation issues confronted by personnel at Pagasa and simi lar agencies would be solved by the new allocations in 2014, he said. Recto said that if not, we will call all stakeholders to the Senate and we will ask them for solutions, legislative in kind, if necessary, on how to prevent technical people from leaving mission-critical posts like air traffic controllers and weather forecasters. Perhaps, this will be what I will first tackle as chair of the committee on science and technologyhow to stop this conversion of government technical people into [over seas Filipino workers], Recto said. If we need to review the pay classification of the Salary Standardization Law III or special provisions or additional allocations in the General Appropriations Act, we will discuss that, he added. Recto said the government cant keep its work force from seeking greener pastures abroad if it cant meet their need for better pay. Talent has the right to go where the money is. Talented people have the right to happiness. If the pay here is really low, you cant issue a hold-departure order against them, Recto said.

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GOCCs defend P2.3B bonuses for employees By Michael

Lim Ubac, Michelle V. Remo, Norman Bordadora, Tina G. Santos Philippine Daily Inquirer
2:39 am | Thursday, January 16th, 2014
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An agency overseeing the compensation in government-owned and -controlled corporations (GOCCs) said the Commission on Audit (COA) had not issued a final notice of disallowance to 31 GOCCs that gave a total of P2.313 billion in bonuses and allowances to executives and employees in 2012. In a report, the COA said the GOCCs paid bonus(es) and allowances and benefits to the board of directors and employees without or in excess of legal basis or proper authority. The Governance Commission for GOCCs (GCG) said in a statement that the GOCCs had amply explained to the COA the bonuses and allowances. Several GOCCs, including Philippine Health Insurance Corp. (PhilHealth), contacted by the Inquirer said the bonuses were aboveboard. But the unauthorized bonuses prompted an opposition senator to cast doubt on the good governance platform of the Aquino administration. Sen. Joseph Victor Ejercito, chair of the Senate committee on economic affairs, blamed the GCG for allowing the bonuses that state auditors found inappropriate. After all that the GOCCs went through and despite the promises made by P -Noy [President Aquinos nickname] in his first Sona [State of the Nation Address], it turns out that the path has yet to be straightened out, Ejercito said in a text message. The windfall of bonuses given to GOCCs during the Arroyo presidency was one of the issues addressed by the Aquino administration shortly after it came to power in 2010. GOCC Governance Act A Senate inquiry into the huge 36-month compensation package at the Metropolitan Waterworks and Sewerage System during the Arroyo administration eventually led to the crafting of the GOCC Governance Act of 2011, principally authored by Sen. Franklin Drilon. The law created the GCG that oversees the compensation of GOCC executives and employees. The problem is the implementation, the violation committed by authorizing the release of bonuses, Ejercito said. It seems there is nothing wrong with the GOCC law. What needs to be done is how to ensure that the governance commission strictly follows the law and at the same time considers the plight of the rank-and-file employees of the GOCC, Ejercito added. Rehash PhilHealth president and CEO Alex Padilla said the issue raised by the COA was a rehash of the same controversy a few months ago, which we have responded to then. Padilla said these are benefits which are granted since six or seven years ago, before my time. There are no new ones. He explained that some of these benefits were either magna carta benefits for health workers or a collective negotiation agreement (CNA). The [CNA] is the counterpart of the collective bargaining agree ment in the private sector. The CNA is a contract between the management and the workers which has a life span of three years. It cannot be breached, otherwise its a violation of the contract, he said.

Padilla cited the PhilHealth law which, he said, allowed the agency to decide on its own the compensation of its personnel so long as it was approved by the board. It does not require presidential approval, he said. The PhilHealth official also questioned the amount the COA was asking the agency to ret urn. I dont know where the P1.6 billion came from. Were still talking here of the same amount, which is P1.4 billion. That P1.4 billion was distributed to 5,900 employees. Were actually in the lower bracket of compensation compared to other GOCCs and the private sector. I hope we put this in the right perspective. PhilHealth has been giving P1.2 billion a week in benefits to PhilHealth members, he said. Difference in opinion There is obviously a difference in the opinion of the COA and PhilHealth . This is a question of interpretation of the law. They have their own interpretation, we have our own, he said, adding that they intend to challenge in court the findings of the COA. This should be settled by the court at the appropriate time, he said . Padilla also said that the PhilHealth board never received a single centavo in bonuses. PhilHealth has 17 directors, 13 of whom are from the government so they receive nothing because that would be double compensation. The four others only receive rep resentation allowances, he said. COA report 4-month-old Lawyer Paolo Salvosa, GCG spokesperson, noted that the order of the COA to refund questionable bonuses and allowances was based on a four-month-old COA report. Acting on the report, the GCG still required the GOCCs to address COAs observations. Nonetheless, by virtue of the PDI (Philippine Daily Inquirer) news item, all the GOCCs mentioned have been directed to submit to the GCG a concrete response and reply thereto within the next 24 hours. The GCG will be issuing within a few days the final responses of the GOCCs and the commissions own evaluation for the guidance of the general public, Salvosa said. Before Aquino administration
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He also noted that the amounts in the report covered various items that were already being granted without legal basis before the Aquino administration. As the current administration has been firm on its policy of not granting post facto approvals, many of these findings have therefore been recurring in COA reports, he said. Salvosa said the GCG had reviewed the COA reports and discussed the findings with the GOCCs concerned (excluding local water districts and economic zone authorities that are not within the jurisdiction of the commission). (E)xcept for three GOCCs, none of the other GOCCs covered in the COA report have been issued notices of disallowance, he said. In fact, after conferring with the COA, no final notice of disallowance has yet bee n issued against the GOCCs mentioned in the report, he said.

Puzzled The management of the airport operator Mactan-Cebu International Airport Authority (MCIAA) said it was puzzled by the COA report. Nigel Paul Villarete, general manager of MCIAA, said the performance-based bonuses that the government-run company distributed to its employees for their 2012 performance was authorized by the GCG. We [MCIAA] are perplexed by the report that we distributed unauthorized bonu ses. The bonuses we gave out were based on the guidelines issued by the GCG, Villarete claimed. Authorized bonus In fact, he said, the GCG issued the authorization for the distribution of the performance bonuses earlier this month. Villarete said he had a copy of the authorization and was willing to show it to respond to inquiries. He said MCIAA did not distribute other bonuses besides the performance-based bonus authorized by the GCG, the mandated 13th month pay, and the cash gift that was common for all government employees worth P5,000 each. A media relations officer for the Development Bank of the Philippines (DBP) said the state-owned financial institution distributed bonuses to its employees using guidelines set by the GCG. The DBP source said the bank did not want to give any further comment on the matter. The Philippine Economic Zone Authority (Peza) also declined to comment on the issue as of press time. Aboveboard At the Clark Freeport in Pampanga province, an official of Clark International Airport Corp. (CIAC) said the bonuses that the agencys officials and employees received in 2012 were all aboveboard. Victor Jose Luciano, CIAC president and chief executive officer, issued this statement in reaction to the COA order for 31 GOCCs, including the CIAC, to return P2.313 billion in bonuses and allowances. It is not true; all bonuses of CIAC are aboveboard, in compliance with the [requirements of the GCG], Luciano said in a statement. The COA report said the CIAC released P23.9 million in bonuses and other benefits to its officials and employees in 2012. These, according to the COA, included the performance-based bonus of P4.1 million and performance enhancement incentives of P1.7 million. The GCG authorized these for that year, Luciano said. He said the Labor Code mandated the 13th month pay while the 14th month pay was part of the agencys employment compensation package. Water districts, Peza Contacted by the Inquirer, presidential spokesman Edwin Lacierda said the three GOCCs that were mentioned in the COA report but beyond the jurisdiction of GCG were Region 7 water districts, Butuan City Water District and Peza. The GCG law excluded local water districts and economic zone authorities, said Lacierda, quoting GCG Commissioner Angela Ignacio.

The GCG, however, still required all GOCCs in their 2013 performance agreements to submit concrete and time bound action plans for addressing COAs observations. This is to ascertain that the fitness of the members of the governing bo ards may already be evaluated pending the evaluation by the COA and the courts on whether a notice of disallowance should be issued, Salvosa said.With a report from Tonette Orejas, Inquirer Central Luzon

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