The Department of Agriculture (DA) said the “root cause” of its billions of unobligated funds last year was the COVID-19 pandemic, following the request of the private sector for the Agriculture Secretary William Dar to explain the findings of Commission on Audit (COA) on the agency’s financial and operational highlights last year.

Such an explanation was sought because members of the Philippine Chamber of Agriculture and Food Inc. (PCAFI) believe that the COA findings will compromise the efforts of both the private sector and the government to urge Congress to give the DA a higher budget for 2022.

In a letter to Dar, PCAFI asked Dar to explain the findings of COA showing the misuse of an estimated P46.681 billion of public funds that farmers were expecting to receive amid the harsh impact of COVID-19 pandemic.

Several items have been cited by COA in the audit, including the P4.55 billion “unobligated amount” due to delays in procurement process and discontinuance of project implementation. The other two items were the P9.89 billion, which was 16.6 percent of DA’s total 2020 budget, being returned due to delay in delivery of goods, delayed submission of disbursement vouchers for payment and the P17.542 billion “non-liquidated” fund.

This non-liquidated fund is in the form of DA’s fund transfers to non-government agencies (NGA), local government units (LGU), government owned and controlled corporations (GOCC), and people’s organizations (PO).

In response, particularly on the P4.55-billion unobligated funds, DA said “the root cause of the unobligated amount is due to the pandemic”.

“Activities were discontinued and there were difficulties in implementation due to health protocols and travel restrictions. Further, there was failure of biddings due to sudden price increases brought about by the pandemic,” DA said.

“We continue to adhere strictly to the requirement that liquidation reports must be supported with duly-signed original documents, but due to health protocols and travel restrictions, there were difficulties encountered in enforcing the submission, even as the DA was never remiss in sending demand letters,” it added.

For his part, PCAFI President Danilo V. Fausto said of Dar that “government officials are the steward of public funds and it is incumbent upon them to make sure that these funds are properly accounted for in the interest of the public that it serves”.

“60 days have now passed from the release of the final report of COA regarding the performance of DA on the use of public funds. We would therefore like to seek clarification from your office,” Fausto further said.

“As you are well aware, we are working very hard to help increase the budget of DA and these COA findings will greatly jeopardize our effort of generating additional resources for our agriculture sector,” he added.

For this year, DA’s proposed budget is pegged at only around P91 billion, way lower than the P231.7 billion the agency was hoping to get.

Dar said such a budget level may not be enough to boost the country’s agricultural production, which has been on a decline for the past three quarters.

“We are still hoping that the budget will increase in a big way,” Dar said in August. “We need a higher budget to increase our output”.