Governance body can’t scrutinize GOCC funds

MANILA, Philippines - A body created by President Aquino to supervise government-owned and controlled corporations (GOCCs) yesterday admitted its hands are tied when it comes to fund disbursements of state-run financial institutions.

“No matter what powers are granted to us by Congress, there’s no way that we can manage (GOCCs’) cash,” Governance Commission for GOCCs (GCG) Chairman Cesar Villanueva said.

“That’s not our mandate to manage – we can’t check on their cash, their checks before they release it – that’s not our job, really. Because if we do that, then the respective governing boards will be rendered inutile,” he pointed out.

GOCCs are run by their respective governing boards that have their own set of rules.

Villanueva told a briefing in Malacañang that their task is only to provide a benchmark for the emoluments of GOCC officials and employees to avoid excesses of perks like in past administrations.

“We look at the GOCC sector and determine what are the proper rates,” he said.

Villanueva, who also holds Cabinet rank, said it would mean “the proper mix of compensation and performance incentive.” Villanueva disclosed a benchmark for the pay scale of all GOCC personnel has already been made, but its approval by the President was sidelined due to the focus on the series of calamities the country suffered in late 2013.

“We were hoping to roll that out through presidential approval before the year ended but things happen. We have had disasters,” he said. “One of our major mandates is to remedy that so that there is uniformity within the GOCC sector. That mandate appears in the approval by the President of a compensation and position classification system (CPCS) that will cover all GOCCs,” he said.  

“Once the CPCS comes into play, it has been vetted properly; it has been compared with NGO salaries; it has been compared with private sector salary. And this will now bind all of the GOCCs,” Villanueva stressed.

State-run institutions, according to the former Ateneo law dean, cannot pull a fast one on them because they have to seek clearance before venturing into anything, aside from the fact that Aquino appointees know the new policy regarding fat bonuses.

“When they don’t get a clearance they now face personal, criminal and administrative sanction,” Villanueva said, adding that board directors are aware that government funds should be spent judiciously without any wastage.

Villanueva also denied the claims of state-owned Philippine Health Insurance Corp. that GCG had given its imprimatur in increasing the salaries of PhilHealth officers and employees.

“Pursuant to the moratorium mandated under Executive Order 7, it is not within the authority of GCG to approve any increase in the rates of compensation, bonuses and allowances on its own,” Villanueva explained, referring to the P1.6-billion notice of disallowance that the Commission on Audit (COA) issued.

State auditors held that such was not covered by any presidential approval.

“Under the circumstances, GCG is duty-bound to await the final decision of the courts on the matter,” since the matter remains pending in the judiciary, Villanueva said.

Governing boards of GOCCs under the Aquino administration are “confronted with a basic dilemma” on how to discontinue hefty perks given by past administrations without violating the principle of non-diminution of benefits, among others.

A case in point is PhilHealth, where its president Alex Padilla argued that under the PhilHealth charter (Republic Act 7875), the board has the “power to provide for a compensation framework” that carried an approval from former President Gloria Macapagal-Arroyo.

Padilla even showed COA the “autonomy” that PhilHealth supposedly wielded over its own officers and personnel.

He said he is willing to “defend their legal position all the way to the Supreme Court.”

PhilHealth management had placed whole-page advertisements in newspapers, including The STAR, arguing their “benefits, allowances and incentives are legal, regular, reasonable and well-deserved.”  

Padilla said they have already submitted their response to the COA report that found the compensations to be unlawful.

“If they come up with a final decision and they won’t change their findings, what will happen is that we will elevate this to the proper agency which is the Supreme Court,” he said.

COA called on PhilHealth and 30 other GOCCs to return to the national coffers some P2.3 billion in unauthorized bonuses paid to their workers in 2012.

COA’s 2012 Annual Financial Report on GOCCs said the bonuses, allowances and benefits to the board of directors and employees of these corporations were “without or in excess of legal basis or proper authority.”

The COA report showed PhilHealth gave the highest stipends at P1,651,084,000.

Padilla, however, argued the stipends got “presidential approval” in 2007 or during the term of former president Arroyo.

“Of course it was before my time.  We have been receiving those allowances since seven years ago. The benefits are the same, then and now,” he said.

Padilla said compensations in PhilHealth have not been increased under the present administration.

“My stand here is that the people have been getting those (compensation) way before and I’m not in the position to scrap them,” he said. – Sheila Crisostomo