Unspent donations as idle funds

It is very disturbing to read the Commission on Audit (COA) report on unutilized donations in the hands of government agencies that were supposed to spend them for relief and rehabilitation works needed by victims of natural and man-made calamities. In that report, the COA called out the attention of the Office of Civil Defense (OCD) over its failure to utilize a combined total of P77.887 million of local and foreign funding donations intended for victims of super typhoon Yolanda and the Marawi siege that wrought havoc to our own people in several disaster-stricken places.

The COA’s annual review covered amounts spent by the OCD as of Dec. 31, 2018. Upon audit at the OCD, the COA discovered that only P94.645 million was utilized out of P135,391,701.96 donations it received from local and foreign sources for the Yolanda victims.

 Super typhoon Yolanda – known by its international name Haiyan – left devastation in several provinces it crossed on Nov. 8, 2013. According to official Philippine government data, Yolanda displaced a total of four million people while official death toll reached 6,100; those injured stood at 28,860; and 1,061 people are still missing.

Foreign donations, like foreign loans, require peso counterpart funding.

The COA noted the unused foreign donations for Yolanda gained on foreign exchange revaluation amounting to P5.648 million. Thus, the total balance of unused Yolanda funds amounts to P46.674 million. 

Worse, the state auditors found out that, of the P36,920,725 donations the OCD received from various local and foreign sources for the Marawi siege rehabilitation, only P10,000 was utilized. The P10,000 represent the maximum amount of financial assistance that the government gives per family of each disaster victim for the dead and P5,000 for those injured.

The financial aid can only be availed by victims if claims are filed and are supported by documents – a process that the COA noted “could be very burdensome for some victims.” COA surmised this “could be one of the causes of low utilization of the donated funds.”

“The poor utilization of the donated funds defeated the purpose of donation and that the good intention of the donors for human consideration was not fully served,” the COA pointed out.

In May 2017, Lanao del Sur’s capital city of Marawi was stormed by heavily armed Maute terrorists known in Mindanao as Islamic extremists influenced by the Iraq-Syria Islamic States (ISIS). Subsequently, President Duterte imposed a Mindanao-wide martial law to contain the Maute-ISIS threat. After five months of fighting, President Duterte declared Marawi liberated from extremists. To date, restoring back to normal the lives of displaced Marawi City residents have yet to take off.

“Clearly, the donations were not utilized to provide for the much needed support of the Marawi siege victims,” the COA report stated.

 In response to the COA report, the OCD explained the reason for the low utilization of the donated funds is that the agency was instead utilizing its Quick Response Fund (QRF). According to the OCD, this was intended “to ensure expeditious delivery of services to the victims of Marawi.”

The OCD added that “initial utilization” of donated funds, including a P1-million support for a project for the Ramadan holiday on June 5 (today’s Ed’l Fit’r), was not reflected in the COA report.

Donations are intended for specific use only. Donors did not obviously wish it would be spent for something not related to helping the rehabilitation of Marawi siege victims.

 In fact, COA flagged one of the OCD implementing agencies for misusing donations to celebrate another Islamic-related celebration. In fact, a separate audit report of the COA called out Housing and Urban Development Coordinating Council (HUDCC) to return the P5 million that it allegedly diverted to the National Commission on Muslim Filipinos (NCMF). State auditors noted that the P5 million intended for rehabilitation projects in Marawi City was transferred to the NCMF and spent for participants of the “2018 HAJJ for the Internally Displaced Persons (IDPs) of Marawi City” in their pilgrimage to the holy city of Mecca in Saudi Arabia. 

While the HUDCC executed a memorandum of agreement (MOA) with the NCMF for the transferred amount, it was drawn from the P500-million fund of the Office of the President (OP) allocated to HUDCC for the operational expenses of Task Force Bangon Marawi (TFBM).

For a better understanding of this COA report, the OCD is an attached agency of the Department of National Defense (DND). It is headed by undersecretary Ricardo Jalad. As the OCD head, Jalad serves also as the executive director of the National Disaster Risk and Reduction Management Council (NDRRMC).

Under the NDRRMC set-up, it is chaired by President Duterte and is composed of the various government agencies like HUDCC that implement relief and rehabilitation works under their respective jurisdictions.

Thus, a few days after the COA report came out, no less than President Duterte obliquely made reference to it that these donations are intact and deposited in banks. Speaking before the 25th Nikkei Future of Asia Conference last Friday in Tokyo, President Duterte reassured foreign donors and investors that their money is safe in the Philippines, citing his continuing crackdown against corruption.

“Do not worry all the donors of the country, your money is in the bank. They are all pledges. And the money that Japan and everybody contributed are all accounted for. We have not spent the foreign aid assistance. We spent first our own money,” the President cited. 

When he admitted the Philippine government has been using its own funds, not the donations, in this particular case of the Marawi siege, President Duterte apparently alluded to QRF that is provided for under the national government’s annual budget.

But why should donations for humanitarian aid remain unspent and just lay idle in the banks? As one Filipino adage goes: “Aanhin pa ang damo kung patay na ang kabayo?”