Senate Minority Leader Franklin M. Drilon on Thursday thanked the Department of Finance (DOF) for acting swiftly on his expose on Philippine International Trading Center (PITC) keeping in banks around P33.3 billion on fund transfers from several national agencies, bulk of which is the P7.04 billion worth of undelivered items to the Philippine Army that includes, among others, coats and ties, jackets, boots and tires.
Upon Drilon’s prodding, the DOF and the Department of Budget and Management (DBM) will now recommend to the President the issuance of a directive for the immediate return of the funds to provide funding to the cash-strapped government.
Dominguez personally called Drilon to inform him of his agency’s positive response to the minority leader’s expose.
In his letter to Budget and Management Secretary Wendel E. Avisado November 25, a copy of which was sent to Drilon, Finance Secretary Carlos G. Dominguez requested the Department of Budget of Management (DBM) to endorse to the President the return of the various fund transfers.
“Following our discussion, we would like to request for the endorsement to the President by the Department of Budget and Management (DBM) for the return to the Bureau of the Treasury (BTr) of the various fund transfers to PITC by certain government agencies, pursuant to DBM’s guidelines on the matter,” Dominguez told Avisado in the letter.
Drilon said the government should immediately ask for the immediate return of the huge cash sitting idly in the coffers of PITC while the government is having difficulties raising funds due to the drop in revenues due to the pandemic.
As of October 31, 2020, the P32.6 billion remains in the hands of PITC, according to the letter and 80 of which represents fund transfers from Philippine Army, P7.04 billion; Bureau of Fire Protection, P3.25 billion; Department of Information and Communication Technology, P3.23 billion; Technical Education and Skills Development Authority, P3.04 billion; Bureau of Customs, P2.44 billion; Department of Health, P2.11 billion; Philippine Navy, P1.74 billion; University of the Philippines Systems, P1.47 billion; Research Institute of Tropical Medicine, P1.16 billion; and Philippine General Hospital, P991.24 million.
“I am glad that the DOF listens and swiftly acts on issues we raised concerning this huge sum of money parked in the PITC. These funds will go a long way. We need P73.2 billion to fund the procurement of vaccines. We need P30 billion annually to address our 6.5 million housing backlogs. We need to feed 5.5 million hungry Filipino families and support the 4.6 million unemployed Filipinos,” he stressed.
“With the return of this P33.3 billion, we now have half of the P73.2 billion needed for the procurement of Covid-19 vaccines,” he added.
The Senate chief fiscalizer, who exposed the shady scheme of PITC of keeping huge amounts of funds in the banks and money market instruments, was surprised to find out from the list of the outstanding balance of the transferred funds held by PITC that the transactions could go as far back as 2007 or 13 years ago.
“It is clear that PITC wants to keep the money in bank accounts. Kitang-kita natin na talagang pinapatulog ng PITC ang pera. No amount of denial and excuses can explain this. This is shady, devious and criminal,” Drilon said.
“The alibi that there are no suppliers will not apply here. Where in the world you cannot buy coats and ties, tires, boots, desktop computers?” Drilon said, referring to items supposedly purchased by Philippine Army in 2007 but were not delivered.
“No excuses, just return the money,” Drilon told PITC. Drilon said the P7.04 billion fund transfers from Philippine Army included items critical to operations of the soldiers, including bullets, radios, first aid kits, etc.
“This explains why our soldiers are still ill-equipped – there is lack of urgency to see the delivery of these essential supplies. This is unbelievable,” he lamented.
The fund transfer goes as high as P7 billion and as low as P15,008, Drilon noted. Even the Presidential Security Group transferred P15 thousand to PITC, the Power Sector Assets and Liabilities Management Corporation deposited P16 thousand, and the Philippine Port Authority transferred P28 thousand, he added. In his letter to Avisado, Dominguez said: “This is in line with our continuous efforts to identify sources of fiscal space and to accommodate the country’s various medical and social needs as a result of the pandemic, compounded by the successive calamities which recently hit the country.”
“If these funds have been there, sitting idly for more than a decade, in the PITC accounts, it means the government agencies have no immediate and paramount need for these projects. It is only right and just that it be returned to the national coffers immediately,” Drilon said.
The minority leader also called out PITC for not prioritizing its principal function of being a trading company. Instead, PITC is focused on managing and growing its funds and the billions of pesos transferred to the agency by almost the entire government.
As early as 2017, Drilon pointed out that the COA flagged that 65 percent of revenues generated by PITC come from non-mandated activities.
He said the disproportion between the company’s income from auxiliary activities and its primary operations only worsened in 2019.