COA: P900-M Malampaya funds didn’t reach farmers


The Commission on Audit (COA) has found that the P900 million drawn from the Malampaya fund as financial aid to farmers stricken by typhoons Ondoy and Pepeng in 2009 never reached the intended beneficiaries at all.

Testifying at the Senate blue ribbon committee hearing on the Malampaya fund anomaly on Monday, COA Chairman Grace Pulido Tan said the P900 million was released to the Department of Agrarian Reform (DAR) supposedly on the request of 97 mayors.

But the fund requests were never validated by the mayors, Tan said.

The DAR also released the funds to 12 non-governmental organizations (NGOs) without due regard to existing laws, rules and regulations, she said.

In fact, the DAR requested the funds from the Department of Budget and Management (DBM) even before receiving the request from the 97 mayors, Tan said.

Only 27 letter-requests were dated October 19 to 21, 2009, and the rest were received by the agency after its October 22, 2009 request to DBM.

There was no proof that the requests were received by DAR on the dates mentioned because there were no proof of receipt on the records of the agency.

DAR signed various memorandum of agreements (MOAs) with 12 NGOs even before the DBM released the special allotment release order (SARO) for the P900 million, Tan said. The DAR also did not validate the mayors’ request.

The 12 NGOs were selected on the basis on the purported recommendation of the 97 mayors and not through public bidding or negotiated procurement. The contracts were split into 97 MOAs or one MOA per LGU in amounts not exceeding P10 million.

Tan said splitting a contract is illegal, adding that P10 million is the maximum amount a DAR undersecretary can authorize.

COA also learned that funds were transferred to the NGOs even before the release of the Notice of Cash Allocation (NCA) on December 21, 2009.

During the hearing, Sen. Joseph Victor “JV” Ejercito asked Tan if the 12 NGOs linked to the Malampaya fund scam were associated with businesswoman Janet Lim Napoles, Tan replied that they are.

Napoles is also accused of masterminding the multibillion-peso Priority Development Assistance Fund (PDAF) scam.

The NGOs Tan mentioned are Karangyaan para sa Magbubukid Foundation; Gintong Pangkabuhayan Foundation Inc.; Kasaganahan para sa Magsasaka Foundation Inc.; Ginintuang Alay sa Magsasaka Foundation Inc.; Bukirin Tanglaw Foundation Inc.; Abundant Harvest for Peoples Foundation Inc.;

Tanglaw Para sa Magsasaka Foundation Inc.; Saganang Buhay sa Atin Foundation Inc., nine LGUs, P80 million; Micro Agri Business Citizens Initiative Foundation Inc.; Masaganang Buhay Foundation Inc., Kaupdanan Para sa Mangunguma Foundation Inc.; and Dalangpan Sang Amon Utod Kag Kasimanwa Foundation Inc.

The COA also found that the addresses indicated by the NGOs were either non-existent or are occupied by other establishments.

In an interview after the hearing, Sen. Teofisto Guingona 3rd, blue ribbon chairman, said there is clearly connivance between the former officials of DAR and the NGOs in the release of Malampaya funds.

Guingona said the committee is considering inviting the former DAR officials headed by former Secretary Nasser Pangandaman, Narciso Nieto and Teresita Panlilio in the next hearing.

He will also invite Napoles and Ruby Tuason, who is being accused as the “real” brains behind the Malampaya fund mess.

Tuason, who is a state witness in the PDAF scam case, is said to have earned P300 million in the Malampaya fund controversy.

Tan also said a big portion of the P38.8 billion releases from Malampaya never reached the projects the money was intended for.

She said many fund releases were not for energy-related projects.

At least 13 different government agencies got shares from the Malampaya fund amounting to P38, 829,875,644 from 2004 to 2011.

Tan said the National Electrification Administration got P1.922 billion from the fund; the Department of Science and Technology-Philippine Atmospheric, Geophysical and Astronomical Services (DOST), P400,000; the National Power Corp. (Napocor) P6.624 billion; and the Department of Energy (DOE), P1.9 billion.

“But we are not even sure that they were in fact employed to energy related projects,” she said.

The Department of Health (DOH) got P745,926 from Malampaya for the procurement of hospital equipment, ambulance, construction and rehabilitation of hospitals.

The Department of Public Works and Highways (DPWH) also got P7.622 billion that were distributed to its regional offices; the Department of National Defense (DND) got P7.456 billion, used on their command centers; and the Department of Interior And Local Government received P2.290 billion.


Please follow our commenting guidelines.

1 Comment

  1. all of these crooks should subjected to firing squad. sometimes this is the examples why we cannot blame the NPAs.