Saturday, July 26, 2008 COA disallows P610T cash gifts
OFFICIALS and employees of Samboan, Cebu have been asked to refund the “extra cash and gifts” that they received in December last year amounting to P610,000.
The Commission on Audit (COA), in its annual report, said that the gifts granted to town officials and employees were in violation of the Local Budget Memorandum since it exceeded the 55 percent ceiling for “personal services.”
“The concerned officials and employees should refund the amount of P10,000 each and management should limit the granting of additional benefits for personal services within the 55 percent (limit set) for a fifth-class municipality as provided for by the law,” COA’s annual audit report said.
In issuing the extra cash and gifts to the town’s officials and workers, Samboan officials cited the budget memorandum issued by President Arroyo in December 2007 on the granting of additional benefits or extra gifts to government workers.
The town council then passed a resolution appropriating a supplemental budget of P610,000 to issue the benefits.
But when the computation was made, the Cebu Provincial Budget Office found that Samboan, by releasing the extra gifts, exceeded the budget limit set for personal services for a fifth-class municipality.
As per records in the budget office, the town’s total income for 2005 was more than P18 million. This means, 55 percent of the amount is over P10 million only.
But the town council appropriated more than P12 million for personal services, exceeding the ceiling by about P2 million.
Actual cost
The town’s budget office, however, denied it had exceeded the limit on the allocation for extra gifts.
It said the “actual cost of devolution” worth over P2 million and which was paid to the health workers should have been “waived and deducted” from the town council’s appropriations.
The municipal government officials also said they were still within the allowable budget even if they granted the extra cash or gifts.
But state auditors said that although the town’s consolidated statement of income and expenses was pegged at more than P23 million, the amount includes its income from its economic enterprises—market and waterworks operations—and the educational fund.
This means, state auditors said, that the amount does not cover the annual income from regular sources in the next preceding fiscal year.
“Income from market and waterworks operations are deemed excluded since the personal services appropriations of these economic enterprises are not included in the computation of the maximum amount for personal services,” COA said in its report.
State auditors also said that the Special Education Fund should not be considered as an appropriation for “personal services” since such allocation should be taken from the annual budget of the school board itself.
As per evaluation by the Provincial Budget Office, the state auditors maintained that the town exceeded its budget limitation for personal services and should not have granted extra gifts to the town officials and workers.
State auditors also suggested that a stringent budget review by the Provincial Finance Committee should be made before disbursing public funds to avoid disallowances in the post-audit. (GMD)
