FIRST, it was bandied about to be a “cash advance” to serve as contingency fund for the trip of recently retired police comptroller Eliseo dela Paz and seven other senior Philippine National Police (PNP) officials to St. Petersburg, Russia to attend the 77th International Criminal Police Organization (Interpol) assembly. Dela Paz himself, upon his arrival from Russia, explained that the €105,000 (or P6.9 million), which he failed to declare before Russian customs authorities last October 11 and for which he and his wife were briefly held at the airport, came from the P10-million fund he had the authority to draw cash advance from.

Now, PNP Director General Jesus Versoza is claiming that the said amount was sourced from the PNP’s intelligence funds meant for the purchase of equipment for its intelligence operations.

The new justification was contained in the PNP chief’s letter last Friday to the Senate foreign relations committee chaired by Senator Miriam Defensor-Santiago that is conducting an inquiry into the scandal. Versoza even requested for an executive session at the Senate’s next hearing so he can discuss the matter with the senators.

Yet at the Senate hearing a day earlier, Versoza could not even answer where the money specifically came from. The PNP chief told the senators that he only learned of dela Paz’s cash advance from Senior Superintendent Tomas Rentoy III, budget division chief of the PNP Directorate for Comptrollership.

Under oath, Versoza also said he did not sign a voucher to release the fund. Neither was he in the know as to which of the PNP’s bank accounts the money was withdrawn.

Switching to another storyline on the dela Paz caper, Versoza has however only lined himself and the other PNP officials up for more violations of laws and government rules and regulations than what they already have committed. As already pointed out by Senators Santiago and Mar Roxas II, the Russia trip of the eight PNP senior officials was in wanton disregard of the following rules governing official travel and the disbursement of public funds:

  • Administrative Order No. 103, issued by Gloria Macapagal-Arroyo on August 31, 2004, which directs the continued adoption of austerity measures in the government by calling for the suspension of “(a)ll foreign travels, except for (i) ministerial meetings, and (ii) scholarship/trainings that are grant-funded or undertaken at no cost to the government;”

  • Executive Order No. 298, issued by Arroyo on March 23, 2004, fixing the rates of allowances for official local and foreign travel of government personnel according to the United National Development Program (UNDP) Index. (The daily subsistence allowance of the PNP delegation was reportedly $467 per member, more than double the stipulated amount of $229.)
  • 2008 General Appropriations Act, Section 16 (c) of which prohibits the use of government funds to “defray foreign travel expenses of any government official or employee, except in the case of training seminar or conference abroad when the officials and other personnel of the foreign mission cannot effectively represent the country therein, and travels necessitated by international commitments: PROVIDED, That no official or employee, including uniformed personnel of the Department of Interior and Local Government and Department of National Defense, will be sent to foreign training, conference or attend international commitments when they are due to retire within one year after the said foreign travel.” (Dela Paz retired last October 9 while five of the seven PNP officials are 55 years old, one year shy of the PNP’s retirement age of 56.)

Instead of clearing up the controversy surrounding dela Paz’s undeclared currency, Versoza’s claim has in fact only raised even more serious questions. For one, the 2008 GAA prohibits the release or disbursement of confidential and intelligence funds in the budgets of departments, bureaus, offices or agencies of the national government unless approved by the President.

Former budget secretary Emilia Boncodin also points out that the purchase of equipment is never taken from the intelligence funds of a government agency. What can be charged to the fund, she says, are maintenance and other operating expenses (MOOE), not capital outlay. In fact, in the PNP’s 2008 budget, intelligence funds totaling P434.3 million are provided for the conduct of intelligence and counter-intelligence activities, and not for equipment.

Boncodin adds that there is nothing in the law that exempts the purchase of intelligence equipment from the government procurement process.

Regardless of the source of funds, whether local or foreign, the procurement of infrastructure projects, goods and consulting services by all branches and instrumentalities of government, its departments, offices and agencies, including government-owned and/or-controlled corporations and local government units shall be covered by the Government Procurement Reform Act, or Republic Act No. 9184.

The GPRA mandates that all government procurement shall be done through open bidding. Government agencies may however resort to alternative methods of procurement as limited source bidding, direct contracting (or single source procurement), repeat order, shopping, or negotiated bidding whenever justified by the conditions provided in the GPRA.

Arroyo’s own directive, AO 103, even lists as part of government’s austerity measures the strict compliance with the GPRA and its implementing rules and regulations in the procurement of goods and services, “particularly in the use of the Government Electronic Procurement System for public bidding, advertisement of opportunities and reporting of bid awards results.”

Based on how Versoza described it, the purchase of intelligence equipment could likely be classified under the shopping mode, which involves directly procuring from suppliers of known qualification of readily available off-the-shelf intelligence equipment. It is not known though if the PNP made prior requests for the submission of price quotations for such equipment. Besides, shopping may only be resorted to for purchases not exceeding P50,000.

Boncodin also says dela Paz cannot bring with him such a huge amount since government transactions are not done in cash. While cash payment is allowed for purchases involving lower amounts, it is not the practice for huge amounts as in dela Paz’s case. “That’s unheard of,” says Boncodin.

Indeed, as a matter of practice, cash transactions are not allowed in government procurement, concurs Professor Leonor Magtolis Briones of the University of the Philippines National College of Public Administration and Governance (NCPAG). “For purchases involving more than P10,000, a check is issued,” the former national treasurer explains.

Briones wonders why as PNP comptroller, who is the guardian of his agency’s finances and who should be doing internal audits of its funds on a daily basis, dela Paz did not seem to know the rules. Such, she says, is a reflection of the “very weak” internal control system at the PNP.

Why the agency is now singing a different tune, Briones suspects, may have to do with the wrong notion that intelligence funds are not subject to scrutiny, and hence outside the purview of the Commission on Audit (COA).

She says the PNP has to be disabused of this idea that has resulted in the accountability for intelligence funds being “very much abused.”

“Intelligence funds are still subject to audit, but only by the COA chairman,” says Briones, who once served as secretary of the state auditing firm.

Whether an audit is done or not, or if the COA chairman’s findings and recommendations are seriously implemented, she adds, is another matter.

2 Responses to Not quite a convincing ‘alibi’


The Equalizer

October 26th, 2008 at 10:32 pm

“Magiging sunod na tanong natin: Okey, nakalusot sila doon sa imbestigasyon sa customs ng ibang bansa. Tingnan naman natin ang patakaran ng Philippine National Police (PNP) kung naisunod ba nila yan. Baka naman naglabag sila ng ibang patakaran ng PNP,”Secretary Ronaldo Puno



October 27th, 2008 at 8:50 pm

Another general Garcia in the making? The smell of a cover-up is in the air. Versoza simply put himself in big trouble. And I thought he’s one of those really good guys in the PNP/military. I read when he was newly appointed as PNP chief that he used to be an activist. Then he made an impressive directive preventing suspects from being paraded in front of the media. I thought that was a good move. Yet this controversy surrounding de la Paz has dragged him down this early. The PNP leadership including the DILG should have just pinned down de la Paz instead of protecting him.

Equally disgusting is the attitude of Miriam going ballistic and once again getting personal w/ old nemesis. Her arrogance was consistently on display. Her acts would be commendable if she’s not playing favorite. Instead of defending the Arroyo govt, she should push for a no nonsense investigation and get mad also over this administration’s alleged abuses and anomalies involving big amounts of money like the fertilizer scam or the ZTE deal, etc.

As it is, Brenda and the other senators are simply grandstanding.

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