Questions were raised about the seeming conspiracy to sweep up idle funds from government-owned and -controlled corporations (GOCCs) as a result of a provision in the 2024 national budget.
That portion of the budget stipulated that the Department of Finance (DoF) had the authority to take the excess funds and return them to the National Treasury.
The funds were then applied to unprogrammed funds, some of which were regular items in the General Appropriations Bill that were bumped off to make space for pork insertions.
The DoF then issued a directive to state firms, including the Philippine Health Insurance Corp. (PhilHealth) and the Philippine Deposit Insurance Corp. (PDIC) to surrender nearly P200 billion in idle funds.
While former finance chiefs Cesar Virata, Roberto de Ocampo, Jose Pardo, Alberto Romulo, Jose Isidro Camacho, Margarito Teves and Cesar Purisima rallied around the DoF circular, former Socioeconomic Planning Secretaries Cielito Habito and Ernesto Pernia and other Cabinet secretaries of previous administrations were opposed to it, primarily the siphoning of PhilHealth funds.
According to the oppositors, a special provision in the General Appropriations Act (GAA) impinging on the charter governing a GOCC was questionable.
The special provision suggested that additional resources can be taken from the GOCCs beyond what their charters specified.
“In the case of the PDIC, its charter categorically stated that it must preserve, maintain, and build up the insurance fund,” the manifesto indicated.
Thus, the past Cabinet officials indicated that while PDIC may remit dividends to the national government, it must follow its charter, including the non-inclusion of assessments collected from commercial banks.
This brought to question the intent of the GAA’s special provision, whether it was intended to extract more resources beyond what the PDIC charter allowed, according to the statement.
It then demanded that the DoF and the PDIC disclose to the public the kind of resources or income that was remitted to the national government.
Last October, the Supreme Court issued a temporary restraining order stopping PhilHealth’s transfer of the remaining P29.9 billion to the government coffers but government sources said all of the P117 billion fund had already been withdrawn.
The original target was bigger — legislators were aiming for the P500-billion PhilHealth reserve for reallocation.
A member of Congress attributed the siphoning of funds to the exercise of the legislature of its oversight function over the national budget.
“Notwithstanding actions by Congress, huge amounts of stranded funds in PhilHealth exist and it would be a great injustice to Filipinos if these funds remain unused,” according to a ranking House appropriations panel member.
The appropriations committee chairman said that since the PhilHealth reserve fund came from the government, it was only proper to reinvest it to benefit more people instead of just leaving it idle. “I must point out, however, that only excess funds must be reallocated, nothing more,” he added.
The House referred to the reserve pool of both agencies as dormant funds that could be put “to better use and lessen the pressure on the government to borrow more and Congress to pass new tax measures.”
The excuse was that the use of the reserves would widen the scope for the private sector to source more funds from the capital market as well as free up more funds for investments instead of using them to pay taxes.
The reallocations will fund the Metro Manila Subway Project and social programs such as the Teacher Effectiveness and Competencies Enhancement Project, according to the supporters of the DoF sweep.
What begs notice is that both projects are essential to sustaining economic and social advances, only to be replaced by accommodations for members of the Senate and the House.
