“Stop that flagging, g**d*** it. You make a report. Do not flag and do not publish it because it will condemn the agency or the person that you are flagging.”

This was President Rodrigo Duterte’s remark after the Commission on Audit (COA) released its 2020 annual audit report. The President’s ire comes from the COA’s findings that flag several key agencies responsible for pandemic response.  

In March 2020, RA 11469 or Bayanihan to Heal as One Act was enacted. The said law gives emergency power and allows the President to “reallocate, realign, and reprograma budget of almost P 275 billion ($5.37 billion) from the estimated P 438 billion ($8.55 billion) national budget approved for 2020, to help combat the COVID-19 pandemic.

Under the Bayanihan Act, government agencies were also allocated additional funds for programs and cash assistance to help the pandemic-battered public.

The Commission on Audit (COA), the government’s spending watchdog, releases an Annual Audit Report (AAR) of government agencies. The report contains“opinions and observations that show compliance and/or non-compliance of laws and regulations governing the use of public funds, mostly taxpayers’ money.

LTFRB and Service Contracting Program (SCP)

In order to help Public Utility Vehicle (PUV) operators cope with their decreased income as caused by health restrictions implemented on PUVs, the Land Transportation Franchise Regulatory Board (LTFRB), launched the Service Contracting Program under the Bayanihan Act 2.

Under the program, operators will get from the national government a one-time incentive of P 5,000 per unit as well as a weekly payout, depending on the predetermined weekly amount, in accordance with their route service plan.

A P 5.58 billion worth of funding has been allotted to implement the said program, and assist PUV drivers displaced by the pandemic.

In the 2020 COA reports, findings show that only P 59 million out of its P 5.58 billion or 1% of the budget allotted for SCP were obligated to its beneficiaries.

COA also flagged that only over 29,800 drivers or 49.79% of the 60,000 targeted drivers as beneficiaries were registered in the program as of December 31, 2020.

In August this year, LTFRB replied through a statement clarifying the COA’s findings of severe underutilization of its budget.

In their statement, LTFRB explained that the memorandum of agreement between them and the Landbank of the Philippines (LBP) was signed in December 2020 “which govern the distribution of cash subsidies to eligible beneficiaries” through the bank’s credit to subsisting LBP accounts or subsisting other bank accounts or e-money/wallet.

LTFRB added that it would be misleading to include reports that only 1% of the budget allocated was used as the audit only covers December 2020.

“Therefore, it is misleading to angle certain reports and columns that only 1% was used from the P5.56-B funds for the Service Contracting Program, where in fact, the 1% utilization rate only covers the implementation month of December 2020, which is also the coverage/extent of the COA report that was released,” LTFRB said in a statement.

Months after being flagged by COA for spending only 1% of its budget allocation for SCP, the transportation-attached agency remains halfway in fully utilizing the budget, resulting in delayed benefits for drivers and operators of PUVs.

“We distributed P2,289,506,007 from September 13 to October 23 from Bayanihan 2, while P539,672,859 [was distributed] from September 13 to October 23 under the [General Appropriations Act],” LTFRB Chairman, Martin Delgra said in a statement.

Drivers’ woes with LTFRB’s SCP

Mody Floranda, National President of Pagkakaisa ng mga Samahan ng Tsuper at Operator Nationwide (PISTON) stated that the LTFRB’s SCP has an underhanded agenda of phasing out traditional jeepneys, as one of the requirements to undergo the program was to surrender their franchise.

“Kasi kapag nagpa-consolidate ka, ang ibig sabihin niyan ay voluntary mong isu-surrender ang iyong prangkisa sa LTFRB. Kasi yung service contracting, walang prangkisa yan e; ang hawak lang niyan e temporary permit to operate. Kaya yung prangkisa mismo ng mga indibidwal, yung mga public transpo -na hindi lamang ng mga jeep ay automatic na mawawala dahil yun nga, isusurrender mo yung prangkisa mo”, Floranda explained in an interview with Manila Today.

Floranda also pointed out the delayed payment for the drivers and operators of the said program. He added that some transport companies were forced to borrow funds, in order to cover the delayed salaries of their drivers and conductors.

“Ang isang malaking problema nila ngayon, doon sa Bayanihan Act 1 and 2, ay nag lapse yan noong June 30, kaya ngayon ay maraming naghahabol na mga operator, maraming naghahabol na mga ruta na hindi sila nabayaran. Hindi lang sa bahagi ng mga modernized, hindi lang sa bahagi ng mga jeepney, maging sa mga bus ay naghahabol doon sa LTFRB na talagang… yung ibang kompanya nga ng bus e ay nangutang na para masahuran ang kanilang mga driver kasi hindi naman pwedeng di nila pasahurin ang mga driver” Floranda said.

When asked about their assessment to the SCP and LTFRB based on 2020 COA reports, Floranda gave them a solid failure remark, iterating that the program wasn’t thoroughly planned and was blind to the actual needs of PUV drivers and operators.

“Kapag kami ang tumingin doon [SCP], bagsak, bagsak ang kanilang programang Service Contracting. Kasi kung maayos ang kanilang pagpapatakbo sa service contracting, walang magra-rally, walang magre-report sa kongreso -walang hihingi ng tulong sa kongreso at senado.”

“…Ang isang malaking problema pa doon ay hindi rin masusing pinag-aralan ng LTFRB at DoTr yung usapin ng service contracting. Kasi, parang ang sabi nga namin, parang huwag lang masabi na wala silang programa.” Floranda furthered.


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