COA: P1.41B Palace fund untouched for years

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    THE Commission on Audit (COA) called Malacañang’s attention anew to a P1.41-billion donation from a company owned by the Lopez family, which remained unused.

    State auditors said the Office of the President could have spent the money for agrarian reform assistance for calamity-stricken areas and other livelihood programs to help the people instead of leaving it in the national treasury.

    Malacañang has yet to issue a statement.

    The same audit observation was made in 2016, which focused on the non-formulation of guidelines or policy for the use of the donation.

    “It was recommended then that, aside from the guidelines, a WFP (work and financial plan) should be adopted by the OP for the utilization of the donated amount, to no avail,” it said.

    In its 2019 audit report, the state auditors flagged the OP for non-formulation of guidelines and WFP for donations, in the same way that the COA did last year and the year before.
    COA said there were no guidelines and WFP for the utilization of the P1,412, 943,850.69 worth of donation from Benpres Corporation, which was intended for economic development projects in line with the national priority plan, such as agrarian reform, assistance to victims and areas affected by natural calamities, and rehabilitation of depressed areas.

    “(These) were not formulated; hence, benefits that could have been derived therefrom were not attained,” the report said.

    Benpres Holdings Corp., now called Lopez Holdings Corp., is the mother company of smaller companies controlled by or affiliated with the Lopez family, who owns ABS-CBN Broadcasting Corp. whose bid for a franchise renewal was rejected recently.

    The original donation was P1.38 billion, gaining interest of P29.6 billion as of the end of 2012.

    The fund represents grants and donations from Benpres Corp., covered by a deed of donation dated Aug. 24, 1990 between the Lopez company and the OP and a trust agreement between Meralco Foundation Inc. (MFI) and a three-member board of trustees, signed in December of the same year.

    The P1.38 billion represents proceeds from the sale of Meralco shares of stocks, composed of the 27,776,557 common shares owned by the OP as a result of a compromise agreement entered into by the MFI and the Presidential Commission on Good Government, and the 3,333,333 shares donated by Benpres.

    Under the deed of donation, COA said the donated Meralco shares could be used by the OP in economic development projects in line with national priority plan, “as it may determine, such as agrarian report, assistance to victims and areas affected by a recent earthquake and rehabilitation of depressed areas.”

    However, as of Dec. 31, 2019, the donated amount had not been used despite, among others, the 2013 earthquake in Bohol with a 7.2 magnitude, the devastation from supertyphoon “Yolanda,” and the 2017 “Marawi siege,” all of which happened under the Aquino administration.

    “The amount could have been used utilized by the OP in mitigating poverty and addressing the needs of the people during those times of natural disaster or calamities that damaged properties and lives of the Filipino people,” the COA said.

    COA said the lack of guidelines for the use of the donation might have been the reason the OP did not touch the fund.