MANILA (UPDATE) - Finance Secretary Carlos Dominguez has asked the Department of Trade and Industry (DTI) to return to the Bureau of Treasury some P1.5 billion in interest earnings the Philippine International Trading Corp. (PITC) made through public funds lodged in the state trading company.
In a letter sent last week, Dominguez told Trade Secretary Ramon Lopez - who sits as the chair of the PITC board - that as of 2019, the state trading firm has been keeping P1.15 billion in interest income.
The funds must be returned to help the government's "continuous efforts to identify sources of fiscal space and to accommodate the country’s various medical and social needs as a result of the pandemic, compounded by the successive calamities which recently hit the country," the letter read.
Dominguez cited a Commission on Audit (COA) report claiming that the PITC has been "aggregating P581.135 Million as of December 31, 2019" as the corporation’s income, "instead of remitting the same to the National Treasury."
The earnings were from the "cash and investment balances transferred by several national government (NG) agencies to the corporation for the procurement of their various requirements," a statement from the Department of Finance read.
Under the law, all interest earned from the deposit of public funds must be reverted to the national treasury.
All public funds unspent by the end of the year should also be returned to the national treasury.
Lopez meanwhile said that the DTI has "no problem" with remitting interest income from the parked funds, especially to fund the fight against the COVID-19 pandemic.
The Trade chief said that PITC has to manage its funds, and the agency has been remitting annually 50 percent of the interest income from the funds to the Treasury.
"I directed PITC to reconcile the numbers with DOF to remit the balance of the interest income," Lopez said in a statement.
Last week, the Senate found that some P33 billion in public funds have been "parked" in the PITC for years after several departments tapped the state trading firm to procure various needs, including face towels and the construction of fire stations in various parts of the country.
Senate Minority Leader Franklin Drilon pushed for the abolition of the PITC, saying that it was duplicating the purpose of existing procurement agencies.
"Sa'kin po dapat i-abolish ang ahensiyang 'yan dahil duplication lamang…at 'yung perang hindi sa kanila ay ginagamit para sa suweldo, bonus, at kanilang operations," he told ABS-CBN's Teleradyo.
(For me, this agency should be abolished because it's a duplication and they use money that is not theirs for their personnel's salary, bonus and operations.)
"'Yan po maliwanag sa kanilang audit report. Kung di po isasama 'yung interes na kinita sa money market na hindi dapat sa PITC ay kulang po ang kanilang kinikita sa iba't ibang sources para bayaran ang kanilang operating expenses, mga suweldo at bonus."
(That is clear in their audit report. If the interest they earned from the money market is not included, they are operating at a loss and have no funds for their operating expenses, salary, and bonus.)