The Philippine Coast Guard had over P600 million in unobligated funds as of year-end 2022, the Commission on Audit reported.

The sum was part of the P20,052,207,957 total allotment obtained by the PCG in the previous fiscal year.

State auditors reported that the PCG only obligated P19,437,487,993 or 96.9344 percent of the entire sum, leaving an unobligated balance of P614,719,964. The lapse, CoA said, was due to a low budget utilization rate for capital outlay.

"Notwithstanding the considerably high obligation rate of 96.9344 percent, the obligations for capital outlay in the current and continuing appropriations were only at P149,292,227 out of the adjusted allotments of P186,810,226 or a rate of 79.9165 percent," CoA said.

Moreover, CoA found that out of P19,437,487,993 in obligated allotments, only P18,145,275,807.09 or 93.3520 percent was disbursed as of year-end, leaving total unpaid obligations of P1,292,212,186.

The PCG's Financial Accountability Report for 2022 showed the agency received total approved current and continuing appropriations of P22,813,207,957, while the full adjusted allotments received were P20,052,207,957.36.

Not compliant

According to CoA, the PCG was not compliant with Republic Act 11639, or the General Appropriations Act for fiscal year 2022 for incurring P600 million in unobligated funds.

RA 11639 mandates that personnel services "shall be available for release, obligation, and disbursement until 31 December 2022." Failure to do so at the end of the validity period results in funds lapsing.

Improved utilization

"Departments, bureaus, and offices of the national government, including constitutional offices enjoying fiscal autonomy, SUCs (state universities and colleges), and GOCCs (government-owned and-controlled corporations), shall strictly observe the validity of appropriations and the reversion of funds," said CoA, citing a provision of the law.

The PCG's staff for comptrollership disclosed to auditors the causes behind the non-utilization of the funds. However, it guaranteed to the audit team that the allotments would be used by year-end 2023.

Meanwhile, state auditors also flagged the PCG for incurring P33,407 in unutilized notice of cash allocations.

"Nevertheless, we noted PCG's high budget utilization rate of 96.9344 percent compared to the CY 2021 rate of 93.2297 percent and non-incurrence of overdraft on PS contrasted to CY 2020 and 2021 budget utilization with a total overdraft of P1,027,831,136.39," CoA said.

"Also, we noted PCG's improved utilization rate for CO of 79.9165 percent compared to the prior year's rate of 25.3758 percent. However, extra efforts are still needed to implement all planned procurement activities within the budget year, it added.