DBM finds anomaly: Calamity funds nearly depleted

By Caroline Howard, ANC

Posted at Jul 10 2010 12:29 AM | Updated as of Jul 25 2010 02:11 AM

MANILA, Philippines - The new administration's economic team has uncovered another alleged anomaly in the previous government's fiscal management.

Budget Secretary Butch Abad said on Friday there aren't enough funds left to deal with calamity disasters this year.

Following a review of the 2010 Calamity Fund, Abad said only 29.6% or P592,034,346 remained of the fund allocated for this year, confirming President Benigno Aquino's fears that the balance of the calamity fund will be sorely inadequate to meet calamity contingencies in the second half of the year.

In a press release, Abad said the Arroyo administration has already used up 70.4% or P1,407,965,654 in the first half of the year.

Of the remaining funds, the previous administration had not released the Quick Response Fund (QRF) of the Department of Social Welfare and Development (DSWD), Department of Public Workds and Highways (DPWH), and Department of National Defense (DND) amounting to P605,500,000.

Once deducted, Abad said this will result to a negative balance in the calamity funds. The negative balance grows even more if commitments of the previous Arroyo administration amounting to P315,150,000 are also to be deducted.

"Ito yung sa konkreto sa sinasabi ni President Aquino, hindi pa sa panahon ng kalamidad ay ubos na ang pera. Ngayong papasok tayo sa panahon ng kalamidad ay kulang na kulang tayo."

(President Aquino says we are not even in a time of calamity and we are seriously lacking in funds to address disasters.)

Pampanga favored in releases

In documents shown by Abad, nearly all of the funds released by the Arroyo administration were for infrastructure damaged by Typhoons Ondoy and Pepeng in 2009.

Noticeably, much of it went to towns in the second district of Pampanga like Lubao, Floridablanca, Porac, Guagua, Sta. Rita and Sasmuan, where former President Gloria Arroyo is a congresswoman.

This is bad news, since the second semester is the most vulnerable to calamity due to the typhoon season.

Earlier this week, President Aquino instructed the country's disaster agencies to prepare for disasters expected to happen around September.

Last year, Typhoon Ondoy devastated major areas of the country. Abad said they will continue to probe other possible anomalies as they go along.

Skewed collection targets

The calamity fund issue is the latest discrepancy uncovered by the Aquino economic team.

On Thursday, Bureau of Internal Revenue (BIR) Commissioner Kim Henares said the government skewed first-half collection targets to make it appear they were exceeding goals.

Former BIR Commissioner Joel Tan Torres has denied the accusations.

Social Welfare Secretary Corazon Soliman said the DSWD had used up P186 million of its P333 million calamity fund for the rehabilitation of areas damaged by storm "Ondoy" and typhoon "Pepeng" last year, and for the internally-displaced persons in conflict areas in Mindanao.

"We are eating up into the 2010 budget for a 2009 disaster," she said.

In case more funds are needed, Soliman said the President could give the DSWD additional budget from the P2 billion Calamity Fund on recommendation of the National Disaster Risk Reduction and Management Council (NDRRMC, formerly National Disaster Coordinating Council).

Budget down to 40%

Abad admitted even the national budget is down to 40% for the next 6 months as 60% of it has been spent by the Arroyo administration.

"Kailangan din naming usisain ang capital outlay, kasi tulad nitong calamity fund hindi normal. (We need to review the capital outlay, What's left of the calamity fund is not normal.)," Abad said. "We should have been prudent for the first half of the year."

He said the funds will surely get used up more so since President Aquino has promised to deliver many public service projects.

Because of this, the Development Budget Coordination committee has raised the budget deficit to P325 billion from the original P293 billion.

"What we did in the second half is use zero-base budgeting approach to come up with priorities and do some realignments," said Finance Secretary Cesar Purisima on efforts to source the additional funds. -- with reports from Ron Gagalac, ABS-CBN; Rafael Santos, ANC