MANILA — The Davao City government “inappropriately charged” P6.454 million expenditures to its Development Fund (DF) sourced from the National Tax Allotment (formerly Internal Revenue Allotment) for local governments, according to the 2022 report of the Commission on Audit.

• Davao City had P2.6B in confidential funds from 2016-2022

State auditors enumerated in the Compliance Audit Report for Davao City the expenditures which were not allowed to be charged under the DF.

The highest amount in the list was P3.2 million spent for the “financial assistance” for the activity “First Centenarian Award in Davao City” in October 2022.

The list also includes the following:

• P125,000 for food and catering for the activity honoring centenarians of the city

• P83,200 for purchase of inventories for distribution

• P1.528 million for cash prizes and officiating fees during the Davao Sports Festival from November to December 2022

• P110,760 for payment for purchase of supplies and materials for consumption made to Davao Knights Tailoring

• P802,964 for meal allowances, telephone expenses and van rental expenses

The auditors noted that under the Department of Budget and Management - Department of Finance - Department of Interior and Local Government Joint Memorandum Circular No. 1 dated November 4, 2020, the utilization of the DF should enable local governments to better address the constantly evolving development needs of their respective constituents.

“As stated thereon, the development projects that may be included under the 20% DF shall be those that are necessary, appropriate, or incidental to efficient and effective governance and those which are essential to the promotion of the general welfare of the people,” the auditors said.

The auditors recommended to the Davao City management to stop the practice of charging the DF for ineligible expenditures and ensure optimal utilization of funds.

The audit report however said the Davao City government assured that they will do better in 2023.

“During the exit conference, the management assured that they will align the CalendarYear 2023 and the succeeding budgets in compliance with the existing laws, rules and regulations governing the utilizatio of the said fund,” the audit team noted in the report.

A copy of the audit report was received by office of Davao City Mayor Sebastian Duterte on June 30, 2023.

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