PITC returns P5.2 billion funds

MANILA, Philippines — State-run Philippine International Trading Corp. (PITC) has returned P5.2 billion of its funds to the Bureau of the Treasury in compliance with the government’s call for additional financing for COVID-19 measures.

The Department of Finance (DOF) yesterday said the Treasury received from the PITC the funds as Finance Secretary Carlos Dominguez earlier appealed to the firm to remit its interest earnings.

The PITC, an attached agency of the Department of Trade and Industry, also returned P1.89 billion to its client agencies, particularly the Technical Education and Skills Development Authority, University of the Philippines Los Baños and the Department of Health, and paid P1.82 billion to its suppliers.

As such, the PITC managed to release a total of P8.91 billion from its balance from January to June. As of the first semester, the agency brought down its fund transfers from state agencies to P22.7 billion from P31.6 billion in end-2020, the DOF said.

Broken down, various procurement filed by multiple offices accounted for more than 73 percent of the balance at P16.6 billion. Further, military procurement made up about 25 percent at P5.62 billion, while savings comprised the remaining two percent at P450 million.

Last year, Dominguez informed Trade Secretary Ramon Lopez of the need for PITC to return its fund transfers to the Treasury at a time the government requires extra budget to respond to the economic and health impacts of the pandemic.

Dominguez noted PITC’s interest earnings were recorded as its interest income, when the state trader should be remitting them to the Treasury as part of procedure.

According to Dominguez, interest earnings gained by the PITC come from cash and investment balances transferred by state agencies to the firm for the purpose of buying their requirements.

Before Metro Manila reverted to lockdown on Aug. 6, Senate Minority Leader Franklin Drilon asked the DOF to sweep through PITC’s finances. The Commission on Audit had flagged the firm’s failure to return P11.02 billion in unused funds to the Treasury or their client agencies.

Drilon said the DOF should direct the PITC to remit the flagged amount to the Treasury, expanding the government’s resourcing in distributing cash subsidies to families affected by the lockdown. He also demanded that the practice of parking funds in the PITC be stopped.

“This practice of parking funds with this GOCC (government-owned and controlled corporation) must stop. The government is hard up due to the drop in revenues. If they cannot disburse the funds just return them to national coffers,” Drilon said.

As a trading firm for the government, the PITC can engage in procurement activities for national agencies, including the outsourcing of goods and services.