P25-B discrepancy in Malampaya Fund

It seems that the multibillion-peso Malampaya Fund will never be free of controversy. Four years ago, former president Gloria
Arroyo and her top officials were charged with plunder for the reported diversion of P900 million in Malampaya money meant for typhoon victims to bogus foundations of alleged pork scam mastermind Janet Lim Napoles.

The Sandiganbayan, meanwhile, is trying local officials implicated in the questionable implementation of infrastructure projects funded by the Palawan government’s share of royalties from the Malampaya gas field.

Three members of then President Benigno Aquino III’s economic team also faced graft charges at the Office of the Ombudsman for allegedly failing to account for P136 billion worth of royalties from the Malampaya natural gas project.

The suit followed an inquiry into the status of the Malampaya Fund by Sen. Ralph Recto, who claimed that the multibillion-peso fund was gone. The complaint alleged that the previous administration was liable for malversation for allowing the Malampaya Fund to be “comingled” with the general fund.

Under the law, royalties from the Malampaya natural gas facility are exclusively for the financing of energy resource development and exploitation programs.

Just last week, the Commission on Audit again found a P25-billion discrepancy in the present balance of the Malampaya Fund. State auditors noticed the variance as the Bureau of Treasury’s status reports and account books reflected varying amounts.

The differences, according to the COA, were about P21 billion in cash releases and P4 billion in remittances as of December 2016, “casting doubt on the reliability of the balance of the Malampaya Fund.” The House of Representatives has called on the Treasury to account for the P25-billion discrepancy.

Started in 2002, the Malampaya project involves the extraction of natural gas off Palawan in the West Philippine Sea. The government share from the operation of the gas wells was supposed to be used for energy projects, but this was amended to finance programs authorized by Malacañang.

Then President Arroyo signed Executive Order No. 848 on Oct. 13, 2009, which expanded the use of the Malampaya Fund outside of the energy sector, at that time to help victims of Tropical Storm “Ondoy” and Typhoon “Pepeng.”

It’s time President Duterte canceled this particular EO and let the original law governing the Malampaya Fund be enforced. The original law is clear that the fund should be used only for energy-related undertakings of the government. Giving discretion to Malacañang to divert the money to other undertakings could result in billion-peso royalties ending up in the pockets of unscrupulous government officials and their cohorts.

Used wisely, the fund can help the government attain some of its socioeconomic objectives. For one, as proposed by the chair of the Joint Congressional Power Commission, Sen. Sherwin Gatchalian, allocating P25 billion — the equivalent of the latest discrepancy uncovered by the COA — could complete the National Electrification Administration’s Sitio Electrification Program to bring power to the 23,681 villages that remain in the dark.

The Malampaya Fund can also be used to lower electricity rates. The Department of Energy has asked lawmakers to pass legislation allowing the government to tap the Malampaya Fund to pay for the debts incurred by National Power Corp. over the years. As it is, we consumers are paying billions of pesos to PSALM (Power Sector Assets and Liabilities Management) Corp., which assumed the Napocor debts when the power sector was privatized.

The Duterte administration has yet to tap a single centavo from the Malampaya Fund, which as of end-2016 was estimated to be worth P236 billion. That’s a lot of money readily available to finance worthwhile projects such as the electrification of the remotest sitios. It should not sit idly when there are many important projects like rural electrification crying out for funds.

Source: http://opinion.inquirer.net/106336/p25-b-discrepancy-malampaya-fund

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