So you may know

In the first of this series on the “bonuses and cash gifts” given by Senator Juan Ponce Enrile to the senators, the gift, in terms of its being described as “additional funds for Maintenance and Other Operating Expenses (MOOE)” was discussed and deemed legal.

This second part discusses other questions in relation to the issue.

1. Is the suggestion for a private audit of the Senate legally feasible?

No. Only the Commission on Audit (COA) is authorized by law to audit government agencies and instrumentalities. However, COA may, when the exigencies of the service so require, deputize and retain in the name of the Commission such certified public accountants and other licensed professionals not in the public service as it may deem necessary to assist government auditors in undertaking specialized audit engagements (Sec. 31, PD No. 1445, otherwise known as the “Government Auditing Code of the Philippines.”).

2. Can the expenses of the Senate be legally accounted for only through the issuance of a certification in lieu of invoices and receipts or their equivalent, among other required documents?

I believe the answer is no. These expenses should be properly accounted for through the submission of prescribed supporting documents, such as invoices and receipts, among others.

3. Is there a law requiring the submission of invoices and receipts, among others, to account for expenses?

Sec. 4, PD No. 1445, otherwise known as the “Government Auditing Code of the Philippines”, provides that “Claims against government funds shall be supported with complete documentation.”

4. Is there any law or government regulation prescribing specific documents to be submitted in support of claims against government funds?

There are laws that prescribe the submission of certain documents for specific transactions or activities. The General Provisions of the General Appropriations Act for 2012, for example, requires the submission to the DBM of a report on the seminar fees collected and expenses incurred thereon (Sec. 10, General Provisions, GAA 2012). COA Circular No. 78-84 dated August 1, 1978, as amended by subsequent issuances, also prescribes the submission of specific documents evidencing government financial transactions.

5. What type of public funds can be accounted for by the mere issuance of a certification duly supported by some prescribed documents which exclude invoices and receipts?

Only intelligence funds are covered by this rule. These funds are used to defray expenses related to intelligence gathering activities of uniformed and military personnel, and intelligence practitioners that have direct impact on national security. Due to the confidential nature of intelligence operations, only a certification is required to account for the different expenses incurred for intelligence operation purposes. The rationale behind this rule is that requiring the submission of invoices and receipts, among other documents, might jeopardize the confidentiality of the intelligence operation.

6. Is there a way to require the submission of the standard supporting documents, such as invoices and receipts, among others, for the accounting and liquidation of cash advances for intelligence funds, without destroying the confidentiality of intelligence operations?

Yes. COA Circular No. 2003-003 dated July 30, 2003, requires the submission of the liquidation report in a sealed envelope visibly labeled “CONFIDENTIAL: For COA Chairman Only”. If access to the liquidation report is given to the COA Chairman only, there is strong assurance that the confidentiality of the intelligence operation covered by this report is effectively maintained. Therefore, Congress, by law, or COA, by regulation, may require the submission of the standard supporting documents such as invoices and receipts, among others, as required by law or regulation, for the accounting of intelligence or confidential expenses.

7. Can MOOE, other than intelligence and confidential expenses, be accounted for only through the submission of a mere certification in lieu of the standard supporting documents which include invoices and receipts, among others?

I believe the answer is no. MOOE, except intelligence and confidential funds, should be accounted for through the submission of the standard supporting documents, such as invoices and receipts, among others, as required by law or regulation.

Given the foregoing facts and premises, I propose the following:

1. If there be another opportunity to amend the 1987 Constitution, the authority to augment any item of appropriation in the budget should be extended to all other government departments, bureaus and agencies. If not advisable to be given to all government agencies, such authority should be extended to the Department of Education, Department of Health and Department of Social Welfare Development because they provide basic social services to the people.

2. Intelligence and confidential funds, as defined in the general appropriations act, should be given only to military establishments, Philippine National Police, Office of the Ombudsman and the National Bureau of Investigation.

3. All public funds, except intelligence and confidential funds, shall be accounted for in accordance with COA rules and regulations through the submission, among others, of invoices and receipts. Except for intelligence and confidential funds, mere certifications should not be accepted as complete accounting for disbursements of public funds.

4. Private audit of public funds should not be allowed as a substitute for the COA audit. Doing so will be unconstitutional.

We know that in a democracy, the government is of the people, for the people and by the people. Therefore, it is the general welfare and interest of the people that should be given paramount importance in prioritizing government programs. In determining who among the people should be given preference in terms of government services, the general welfare and interest of the majority of the people must be given more weight and preference. Government agencies that provide social services must be given priority in the allocation of public funds simply because they are the ones whose services benefit the greatest number. In conceptualizing and formulating constitutions, legislation and government budgets, there should always be fairness in the granting of privileges, incentives and allocation of limited resources. If there has to be prioritization, the same has to be done with the general welfare and interest of the greater majority of the people in mind. If there be partiality in the process, the end result will definitely not last as it is not founded on fairness and equity.