Dominguez tells PITC to remit ₱1.15B additional funds to National Treasury

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Finance Secretary Carlos Dominguez III (FILE PHOTO)

Metro Manila (CNN Philippines, November 30) — The Philippine International Trading Corp. should turn over ₱1.15 billion to the national government after profiting from billions of funds held in trust on behalf of other agencies, the Department of Finance said.

Finance Secretary Carlos Dominguez III said in a statement that he wrote to Trade Secretary Ramon Lopez, who oversees the PITC, to turn over the amounts earned by PITC from holding on to idle funds of other agencies.

Dominguez said the ₱1.15 billion should not be classified as interest income, rather, it should be remitted to the National Treasury. He confirmed the claim of Senate Minority Leader Franklin Drilon that PITC is sitting on funds amounting to ₱32.6 billion as of end-October, representing cash and investment balances from other national agencies on standby for their procurement needs.

The interest earnings were generated from the ₱33.3 billion balance which PITC held as of end-2019, coming from allotments turned over by various agencies.

RELATED: Trade chief open to Senate review of PITC functions as DOF seeks return of ₱33-B funds

PITC is mandated to engage in both export and import trading of new or non-traditional products and markets, and provide export-oriented auxiliary services that are not usually pursued by the private sector. The unit is also eyed as the main procurement channel for COVID-19 vaccines.

Drilon earlier exposed that at least ₱18 billion in government funds were allegedly parked in the accounts of the PITC, calling for a probe as to why the money has been lodged there. Dominguez confirmed that there was about ₱33 billion stuck with the PITC, which he wanted the Budget Department to pull out.

However, the PITC earlier denied maintaining billions of pesos in idle government funds, saying the body has returned all unutilized budget to the National Treasury. Lopez also explained that the funds are deposited in government banks, and will be surrendered to the DOF unit if biddings fail.

Dominguez cited the Commission on Audit in demanding the turnover of the funds, saying the interest earnings cannot just be declared as PITC income.

He added that the turnover of the money is necessary as the government seeks to "accommodate the country’s various medical and social needs as a result of the pandemic," as well as to respond to recent calamities.

Senator Francis "Kiko" Pangilinan again called on the PITC to return the money to public coffers, threatening criminal charges if they fail to do so. Pangilinan, a lawyer, said the country's anti-graft law allows lawsuits against public officials for "causing undue injury due to gross and inexcusable negligence."

Bakit pa mangungutang kung meron namang pwedeng makunan ng pondo?" Pangilinan said in a statement on Monday. "Para sa amin, kitang-kita naman na ang dapat inuuna at binibigyang-solusyon ay ang kagyat na usapin ng COVID-19 vaccines at ang mga nasalanta ng bagyo."

[Translation: Why should we borrow more money if we have available funding sources? For me, it's obvious that we should prioritize and provide a solution to the urgent procurement of COVID-19 vaccines and aid to typhoon victims.]

RELATED: Almost ₱3B needed to cover initial cost of COVID-19 vaccines, proper storage – DOH

The Philippines has resorted to additional borrowing this year to cover unexpected emergency spending due to the pandemic. The government also plans to take out more loans from institutions like the World Bank for vaccine procurement.