COA orders Palawan gov’t to return P35M excess bonuses


MANILA, Philippines – The Commission on Audit has ordered the provincial government of Palawan to return P35.338 million in unauthorized cash bonuses paid to local government officials and employees in 2013.

In the COA audit report released September, state auditors said the province violated a Department of Budget and Management (DBM) circular when it released performance enhancement incentives (PEI) worth P40,000 to all officials and regular employees of the province.

Coa said the DBM only permitted payment of P5,000 PEI across-the-board.

The excess bonus was supposedly approved by the provincial board or the Sangguniang Panlalawigan, as it passed Resoultion No. 10855 on December 17, 2013, allowing P40.38 million of incentives in total.

“Review and verification of the disbursement vouchers and general payrolls covering the payment of PEI for CY 2013… revealed that the said PEI was granted to 1,030 qualified officials and employees… resulting to an overpayment of P35.338 million,” the COA said in its audit report.

COA said its general counsel already issued an opinion on December 18 that the maximum amount to be paid for PEI to all classes, without exception, is only P5,000 and that any amount in excess will be a violation of DBM Budget Circular No. 2013-3 and Executive Order No. 80.

“The law and regulation set the limit of the PEI, which is not exceeding P5,000 each employee across the board, to ensure that the amount of PEI fixed by the Sanggunian is reasonable and that the expenditure will not adversely affect the operation of the LGU. We recommended that the recipient official and employees refund the total amount of P35,228,000 in excess of the authorized amount,” the COA added.

In its defense, the provincial government said local government units have fiscal autonomy and that the release cannot be considered unwarranted.

Citing the DBM Circular, the provincial government said LGUs are required to source the PEI from available savings in their budget, as long as approved by the provincial board.

It maintained the PEI was the employees’ reward “for their efforts in the dispensation of public service.”

The COA, however, insisted its decision that the provincial government violated national rules. After all, COA said the Supreme Court has ruled in 2000 that the fiscal autonomy of LGUs is not absolute and should comply with national policies. –

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