Thursday, September 22, 2005

Unliquidated cash advances hit P3.3B


By Maricel V. Cruz, MT Reporter 

THE unliquidated cash  advances of public officials and employees could be one of the main reasons why the national government has racked up a huge budget deficit.

Liberal Party Rep. Rolando Andaya of Camarines Sur, chair of the House Committee on Appropriations, said national government officials and employees chalked up P3.3 billion in unliquidated cash advances in end-2004.

The P3.3 billion refers to advances posted by national government agencies and does not include those incurred by those working in local governments and government corporations. 

Citing a document that accompanied the proposed P1.05-trillion 2006 national budget, Andaya said the Commission of Elections posted the highest unliquidated cash advances—P1.6 billion.  But Andaya was quick to point out that this was understandable owing to the fact that 2004 was an election year.

The other government offices with huge unliquidated advances:

• Department of Education, P393 million

• Department of Foreign Affairs, P170 million

• Department of National Defense, P114 million

• Department of Agriculture, P104 million.

• Office of the President, P62 million

• Department of Telecommunications, P52 million

• Department of Environment and Natural Resources, P49 million

• Department of Agrarian Reform, P44 million

• Department of Public Works and Highways, P40.3 million

• Department of Labor and Employment, P40.2 million

• Department of Finance, P32 million

• Department of Health, P29 million

• Department of Interior and Local Government, P26 million

• Department of Trade and Industry, P25.2 million.

At the bottom on the list was the Metro Manila Development Authority with an unliquidated cash advance of P3,400.

According to the Commission on Audit, Andaya said, “The P3.3 billion [consisted] of unliquidated cash advances of officials and employees for expenses in connection with their official foreign and local travels, billings for overpayment of salaries, other expenses, and cash shortages.”

He hastened to add that an unliquidated cash advance does not mean that the money “was spent illegally, but that there was just some delay in explaining how it was spent.”

“It could be a reporting delay. The judgment on whether or not the money was rightfully spent was suspended until the supporting documents were in. A mammoth bureaucracy that spend nearly P1 trillion a year is bound to encounter these reportorial glitches,” Andaya explained.

In most cases, however, the liquidation of expenses meets government audit and accounting rules, Andaya said.

But once the unliquidated cash advance becomes what is called a  “disallowed expense,” Andaya said, then government should seek reimbursement from those who made the illegal expenditure.

He expects heads and agencies to be ready with their explanation on this matter when they appear before his committee soon to defend their 2006 budget requests.

Andaya’s panel will hold its preliminary budget hearing on the proposed 2006 national budget any time this week as Congress resumes session Monday


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