THE Commission on Audit has denied the appeal of officials of the San Ildefonso Water District (SIWAD) in Bulacan for the lifting of the Notices of Disallowance (NDs) issued against the payment of illegal bonuses and allowances in 2013 totaling P1.55 million.
In a 12-page decision released last week, the COA en banc sustained the findings of COA Region 3 that the NDs were valid and that SIWAD executives held liable for approving and certifying the disbursement are solidarily liable, meaning they are required to refund the disallowance.
“The petition for review is without merit. The approving and certifying officers are solidarily liable to refund the amount disallowed; while the payees are liable only to the extent of the amount that they received,” the Commission said.
The disallowed fund releases cover P536,255.94 representing contributions to the Employees’ Pension and Retirement Benefits Reserves and Mutual Funds (Provident Fund) and P1,013,413 paid out as Anniversary Bonuses and Rice Allowances.
Held liable were SIWAD general manager Galo Antonio Violago, acting accountant Emerlita de Jesus and officers and employees who benefited from the Provident Fund or acknowledged receipt of the bonus and allowance.
SIWAD’s petition for review argued that paying the rice allowance and anniversary bonus was a long-time practice in the water district, hence stopping it would go against the rule on non-diminution of benefits.
The COA disagreed, noting that SIWAD paid its personnel the equivalent of one month’s salary as an anniversary bonus when Administrative Order No. 264 s. 1996 states that it should not exceed P3,000 for each employee.
Likewise, such a bonus may be paid only in a milestone year, whether the 15th Anniversary and every fifth year after that.
On the other hand, the rice allowance is a non-integrated allowance defined in Section 12 of the Salary Standardization Law and may be granted to employees who are incumbents as of June 30, 1989. This was not shown in the case of SIWAD personnel.
“In this case, records do not show that recipients are incumbents of positions and were receiving the Rice Allowance as of July 1, 1989. Accordingly, this Commission affirms the disallowance on the payment or Rice Allowance in the amount of P714,000,” the COA said.
Regarding the Provident Fund contributions, auditors noted that there was no proof that the sum released came from SIWAD’s savings as required by the Department of Budget and Management (DBM) Budget Circular No. 2008-03.
“There can be no diminution of benefits since the recipients thereof are not entitled to the same in the first place. The grant of Rice Allowance was anchored on an erroneous application of the law,” the Commission added.
