COA rules on merits; clears late Benguet solon of P33-M in disallowed incentives

Published July 11, 2021, 7:01 PM

by Ben Rosario

The late Benguet Rep. Nestor B. Fongwan has been cleared of liability in the allegedly unauthorized payment of P33.28 million in Productive Enhancement Incentive (PEI) benefits to provincial officials and employees but not because he is already dead and could no longer be held accountable for the questioned disbursement.

Late Benguet Rep. Nestor Fongwan

Fongwan died a few months after his election as congressman of the lone district of Benguet. The Commission on Audit-Commission Proper issued the decision exculpating him of liability for the disbursement of funds for PEI payment was issued on May 4, two years after his passing.

In the decision released on Friday, July 9, the COA-CP lifted the Notice of Disallowances (ND) previously issued by the audit agency as it upheld the Petition for Review Fongwan and other former and incumbent officials of the province filed in questioning the ND.

In 2015, Fongwan, who was provincial governor in 2013-2016, and other provincial official were held liable for authorizing the payment in 2014 of P24,604,235.89 and P8,684,390.36 to provincial employees.

In its audit of the PEI that was disbursed in 2014, the COA Cordillera Administrative Region (COA-CAR) upheld the issuance of ND covering the releases of PEI amount to P5,000 for each qualified employee of the province.

Aside from Fongwan, also held liable were then Vice Governor Nelson C. Dangwa and Sangguniang Panlalawigan members Florence Tingbaoen, Johnny Waguis, Esteban Piok, Jack Dulnuan, Nardo Cayat, Benjamin Saguid, Robert Namoro, Jim G. Botiway and Blas Dalus.

In 2016, Fongwan appealed the COA-CAR decision as he cited the laws that granted the provincial government the authority to distribute PEI incentives to employees.

In issuing the ruling, the COA-CP composed of Chairman Michael Aguinaldo and Commissioner Roland Pondoc noted that Department of Budget and Management Budget Circular No. 2014-3 authorizes the grant of PEI to employees of local government units. “at the rates determined by the respective sanggunian (legislative council).” “Thus, insofar as LGUs are concerned, the grant of PEI is determined depending upon their financial capability but subject to the Personal Service limitation imposed by the Local Government Code,” the COA-CP explained.

The panel stressed that contrary to the COA-CAR director’s decision, LGU’s are granted the discretion to distribute PEI beyond P5,000 provided that the total amount will not exceed the “PS (personal service) limitation” set by Republic Act 7160 or the Local Government Code.

The Audit Team Leader and Supervising Auditor were directed to “look into the actual PS cost of the province” to determine whether or not the legal limitation prescribed under RA 7160.

In the meantime, the COA-CP lifted the ND issued for the disbursements.