COA: Three NGOs involved in rice program anomaly

The Commission on Audit (COA) reported that three non-government organizations involved in the controversial Ginintuang Masaganang Ani (GMA) program purchased "massively" overpriced fertilizer.

In its preliminary audit report on the so-called "fertilizer fund scam," the COA discovered that the Kasosyo Foundation purchased fertilizer at a total cost of P6 million, but the commission canvassed other suppliers and found that the same amount of fertilizer could be purchased for P503,000.

Kasosyo Foundation’s purchase was overpriced by more than 1,000 percent or P5.497 million, the COA said.

The National Organization for Agricultural Enhancement and Production (NOAEP) was also found to have purchased overpriced fertilizer at a total cost of P19.851 million.

The COA’s canvass found that the NOAEP could have bought the same amount of fertilizer for P2.28 million.

As for the Philippine Social Development Foundation Inc. (PSDFI), the COA found that the foundation purchased P3 million worth of fertilizer that could have been bought at a cost of P468,750.

The COA’s audit report also revealed that these non-government organizations utilized exclusive distributors even when similar products were available in the market at lower prices.

The organizations also selected the distributor without a public bidding even though there were other suppliers available, the COA added.

"The manner of the awards by the RFUs (regional field units of the Department of Agriculture), and local government units (LGUs) of the majority of the purchases was done through direct contracting when fertilizers can be obtained from many sources," the COA said.

Of the three organizations that purchased the fertilizers, only the Kasosyo Foundation conducted a canvass, but it still purchased overpriced fertilizer.

"Disbursements of funds by the Kasosyo Foundation for the purchase of fertilizers were supported by canvass documents but the reasonableness of price is doubtful as the specifications of the fertilizers in the canvass sheets were not indicated," the COA said.

The commission also noted that the NOAEP received funds from the Department of Agriculture for the GMA program even though it had "doubtful financial capability and experience."

"Memoranda of agreement were entered into by the various LGUs of Region 10 with the NOAEP, whose equity is far below the contract amount and its experience short of what is required as it was established two years before the contract period," the COA said.

In Region 10, where the NOAEP was to distribute the fertilizers, the COA found that the distribution could not be validated due to lack of information on its farmer beneficiaries.

Neither could the commission evaluate the efficacy of the purchased fertilizer since the non-government organizations directly delivered the goods to the recipients.

The COA recommended that Agriculture Secretary Domingo Panganiban conduct a deeper investigation to determine liability for the anomalous purchase of fertilizer and farm implements at the level of the RFUs, LGUs, and non-government organizations and to file legal action if warranted.