Layers of kickback: Only 40% of flood funds reach project, says Lacson
MANILA, Philippines — Corruption in flood management is a “piece of cake.” That was how Sen. Panfilo “Ping” Lacson on Wednesday described what he called systemic abuse of funds in the government’s flood control program.
In a privilege speech, Lacson alleged that billions of pesos in flood control funds have been carved up among corrupt players in both the public and private sector.
He claimed that only about 40% of the budget goes to actual implementation.
Lacson said that while this does not apply to every flood control project, there is a “pillaging pattern” that remains constant.
“The pie-sharing varies depending on the level of greed,” Lacson said.
Deductions and profits
Lacson explained how a P100 million project typically breaks down. Legal deductions include 5% for value-added tax, 2% for withholding tax, and 1% each for bonds, insurance and materials testing. Contractors also take 8% to 10% as profit.
That leaves about P82 million for implementation, he said.
Then further layers of kickbacks drain project funds.
Lacson said 8% to 10% often goes to a Department of Public Works and Highways official—and project personnel would be lucky if they get the official to agree to 6%, he noted.
The “lagay” does not end between the contractor and the DPWH, however.
Another 2% to 3% is allegedly taken by the district engineering office, and 5% to 6% by members of the Bids and Awards Committee.
Even the Commission on Audit could receive a share of 0.5% to 1%.
Local politicians, he said, would then collect a “passing through or parking fee” of 5% to 6%, described as the “royalty” for controlling the district where the project is built.
Finally, 20% to 25% is returned to the funder or political proponent.
“Napakaswerte nang umabot sa 40% o P40 million alinsunod sa ating halimbawang P100 milyon pondo para sa proyekto,” Lacson said. (We are lucky if we reach 40% or P40 million, if we follow the P100 million example for a project.)
Lacson said his figures were drawn from case studies in areas investigated by his team.
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