The case against PHISGOC

In the run-up to the imminent Philippine Olympic Committee elections, a group of current POC officials who are running are preparing a case against officers of the Philippine SEA Games Organizing Committee. PHISGOC, to this date, has not reported or accounted for any of the monies spent – and earned – in the biennial competition. Some of those who will be named in the legal case are past and present POC members, and candidates for positions on the POC Board. PHISGOC was meant to submit its financial report on the Games on Jan. 10, or one month after the conclusion of the country’s hosting, for the Commission on Audit to review.

Prior to the opening of the Games, The STAR broke the story that the custom-built cauldron to be used for the ceremonial lighting of the flame cost a mind-boggling P59.2 million, or more than $1 million. A source furnished The Star with the budget of the Games, copies of which were already in the possession of all involved government agencies. The design of the cauldron alone cost P4.4 million; site construction was priced at P13.44 million; physical construction and installation of the cauldron itself was P32 million. A whopping P6,000,000 was allocated for still-unexplained wrist tags.

Even before The STAR exposé, legislators were already questioning the budget for the event, which was 20 times the amount the country had spent when it last hosted the meet in 2005. Soon, other items on the budget came under scrutiny. PHISGOC officials tried to blame the Philippine Sports Commission and even Congress itself for the delays in budget disbursement and procurement of equipment. On top of that, upon the instructions of President Duterte, the PSC spent an additional P522 million to cover all the missteps and inadequacies of PHISGOC.

As the competition progressed, a new question was raised: where was all the money that the 12 days of the SEA Games brought in?

Major SEA Games event sponsorships were priced at a million US dollars and up, with some smaller packages available. The PSC said that the undeclared revenue generated by the broadcast rights and other sponsorships were meant to fund the 10th ASEAN Paralympic Games which were to be held immediately after the SEA Games. With the COVID-19 outbreak, the Para Games did not push through.

The government is estimated to have spent hundreds of millions of pesos to hire American broadcast producer NEP Group, Inc. to sell the broadcast rights for the Games to at least 10 other ASEAN countries that participated. The amount paid to NEP is not clearly indicated in the budget for the SEA Games. The funds merely passed through the PSC, since private entities are not authorized to handle government funds. Is it true that one of the foreign broadcasters who paid for the broadcast rights in their country did not get what they paid for? This matter is also being ascertained by investigating POC officials. Revenue earned by government agencies is routinely remitted to the National Treasury.

“The 30th SEAG was hosted by the government with a budget of P 7 billion, through PSC,” PSC chairman Butch Ramirez said last December. “And therefore, all income from all activities by PHISGOC must go back to government, like TV rights, tickets, and all fund-raising activities by PHISGOC and POC. It’s a COA rule.”

So it appears that what we have now is a two-pronged mess used to skewer public funds. It also appears that POC officials who volunteered for the SEA Games were actually paid professional fees. PHISGOC is a foundation, not a commercial entity. Its original incorporators will now have to jointly show where the money was spent, or individually defend themselves by proving that they had resigned, or were removed or replaced before money started being spent and received. What is clear is substantial public funds were misspent, a lot of money was earned, and no one is telling the government where it all went.