'Missing' state money in banks could slash deficit

Sen. Ralph G. Recto today pressed the Department of Finance (DOF) to fast track its inventory of all idle or dormant multi-billion cash wealth stashed away in government and private banks that have remained unaccounted for up to this day.

"In the first four months (in office), the first thing that we should be doing is to inventory where these monies are deposited," Recto said during yesterday's budget hearing of the Department of Finance (DOF).

"It should have been done yesterday. But six months should be enough for them to locate these cash assets," he added.

Recto said the DOF secretary could use the dormant unaccounted funds to "significantly slash" the projected P325 billion deficit for this year.

He said four months into office, the DOF still has no idea how much cash money are parked in the vaults of the Bangko Sentral ng Pilipinas (BSP) or deposited in bank accounts of various commercial banks.

Recto said the DOF, through the Bureau of the Treasury (BTr), kept these funds in 400 bank accounts but the Commission on Audit (COA) was having difficulty in "locating" these funds.

"There are 400 bank accounts. Are we managing it property? Who are these depository banks and how much are they earning in interest?" he said.

"How much money are in the banks? Are they still there?" he added.

Recto said COA discovered 'billions in billions" in discrepancies between those reflected in the books of the BTr against those cash deposited in bank accounts.

"If the COA as per its 2009 report could not account for these BTr funds, we are facing a Treasury that must take a refresher course on 'Safekeeping 101'" he said.

The COA said the BTr seems to have lost "track" of some P64.3 billion in state funds, which are "missing" upon reconciliation of the agency's books and those in the purported bank accounts.

The BTr reportedly maintains a total of 400 bank accounts for tax and non-tax revenues and other money remitted or turned over to it by revenue-generating agencies and state enterprises.

The agency either deposits these cash money in the BSP or in chosen depository banks, including private commercial banks.

The COA has also found P48.645 billion in negative sub-account balances, which rendered doubtful the reported cash in the bank accounts of the treasury.

Recto said glaring deficiencies in the loans receivables and accounts maintained by government-owned and controlled corporations (GOCCs) reaching P83 billion were also discovered.

He said even the computation on the receivables from the 137 GOCCs worth P385.68 billion against the actual money payments could not be reconciled.

"The unaccounted or unreconciled funds are mind-boggling. The DOF need not worry about a run-away deficit this year if it only knows how to summon these funds," Recto said.

Recto said this is also the first time that the COA is "unable to render an opinion" on a key government agency that serves as the repository of the country's wealth.

He stressed he was not surprised if the P70 billion remitted as dividends to the government from the Malampaya gas project were also part of the unaccounted funds.

"This explains why after repeated assurances that the Malampaya money was intact, the funds have actually dissipated like a gas bubble," Recto, chair of the Senate ways and means panel, said.

He said a special account should have been set-up for the Malampaya funds for better disbursements and management.

"Why was the Malampaya cash co-mingled with the general funds? Something of this nature should be put in one special account," Recto stressed.

The senator said the DOF could tap into these idle bank accounts and even a portion of P110 billion retained earnings of the Philippine Health Insurance Corp. or PhilHealth to jump start infrastructure projects under the Public-Private Partnership (PPP) program.

"The net effect of this is that there are so much resources available for the government to fund much-needed infrastructure projects," Recto stressed.

He also said the billions of "Juan de la Cruz" money that could not be accounted for could be the "smoking gun" on the missing P70 billion Malampaya gas dividends.

Recto, who is vice chair of the Senate finance committee, had earlier asked the DOE and DBM to explain the P20-billion disbursement from the Fund.

But Recto stressed that there might be a need to organize a "search team" for the balance of P70 billion, whose 'whereabouts" have yet to be ascertained.

"P70 billion is a lot of money and I can imagine how much interest income is earned from such an amount. The people have the right to know where and how these funds are kept and used," Recto said.