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Thursday, September 01, 2005
COA disallows Liloan bonus, cash gift
By Jeanette P. Malinao
Sun.Star Staff Reporter
In Liloan town in northern Cebu, P4 million that could have been used for “better public services” was used for bonuses of officials and employees.
Not only that, the Liloan Municipal Government extended cash gifts way beyond what the town could afford, and even released collective negotiation agreement bonuses even if the Com-mission on Audit (COA) already told them in the previous year that it is illegal.
The COA, in its audit report for Liloan’s operations in 2004, said the town gave P15,000 “extra cash gift” aside from the regular cash gift of P5,000 each.
The Municipality could have just given P101.21 each if it really wanted to give the bonuses, so it would not exceed the 45 percent limitation for personnel services.
Specific
Aside from the limitation on personnel services, a circular from the Department of Budget and Management is also specific that the gift could only be given if there are savings.
The extra cash gift totaled P1,680,000, while the collective negotiation agreement bonus amount-ed to P2.4 million.
The COA told Liloan officials not only to refund the collective negotiation agreement bonus, but also to “exercise diligence” in granting benefits.
While the Liloan Municipal Government was excessive in giving out benefits, it failed to put in place a custodian of government property.
The COA criticized Liloan for failing to submit inventory reports, a matter which COA has “repeatedly demanded” from town officials.
“No inventory report was submitted...and no physical inventory has been conducted, contrary to (COA rules),” read the COA report.
It turned out that no one has been designated as custodian of government properties.
Moreover, COA noted that Liloan’s “payables” are overstated due to inclusions of “accounts without valid claims and other improperly classified transactions.”
Unknown
COA verified the account and conducted interviews. It learned that of the P11,697 due to officers and employees, P6,167.46 are “payables to unknown employees.”
Some of the amount is also in “excess” of terminal pay due to retired officials and workers of the municipality.
Also, auditors found that the municipality paid a retainers’ fee for a legal consultant, amounting to P120,000, a violation of rules.
COA issued a circular in 1995 prohibiting the hiring of private legal counsels to represent local government units in court.
The Local Government Code provides that in case a town encounters any legal problem, it should secure the opinion of the provincial legal officer, or the provincial prosecutor “without incurring additional expense.”
“The hiring of a legal consultant at P10,000 a month or P120,000 per year is without legal basis, hence, an irregular expenditure,” read COA’s report.
Mayor Maria Sevilla reportedly concurred with the observation and “promised” to stop the consultancy services.
(September 1, 2005 issue)
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