DOH 'did not effectively monitor' use of ₱746-M Malampaya fund meant for Ondoy repairs — COA

Metro Manila (CNN Philippines, November 26) — The Department of Health (DOH) did not effectively monitor the usage of a ₱745.93 million Malampaya fund allotted to them in 2009 meant to rehabilitate DOH facilities struck by Typhoon Ondoy, the Commission on Audit (COA) found.

"The audit concluded that the DOH did not effectively monitor the status of utilization of Malampaya Fund including the implementation of the projects for which it was released," the state auditors concluded in their sectoral performance audit released October 2022.

"A number of programs/projects implemented by the hospitals and health facilities involved were not compliant with the required specifications and implementing guidelines," it also said.

The Malampaya Fund consists of the national government's earnings from the Camago-Malampaya natural gas project since Oct. 26, 2001. From Jan. 1, 2002 up to June 30, 2013, the national government earned ₱173.28 billion from the Malampaya gas fields.

As of May 21, 2012, some ₱38.84 billion had been released to national government agencies (NGAs) by the Department of Budget and Management (DBM) according to COA.

Exactly ₱745,926,000 had been released to the DOH in 2009 under Special Allotment Release Order (SARO) B-09-09046 for the purpose of repairing DOH hospitals and health facilities and the procurement of equipment following the onslaught of Typhoon Ondoy.

"The DOH transferred Malampaya Fund of ₱32.77 million to two hospitals and one health facility four to 21 months after the release of SARO, or seven to 24 months after typhoon Ondoy has occurred," the sectoral performance audit read.

"This defeats the purpose for which the fund was released, specifically, for the urgent repair/rehabilitation of DOH hospitals and health facilities and purchase of equipment damaged by the said typhoon," it added.

These three were the National Nutrition Council (NNC) at ₱22 million, the Philippine Heart Center (PHC) at ₱5.77 million, and the Lung Center of the Philippines (LCP) at ₱5 million.

In total, 18 DOH-run facilities were listed as damaged by Ondoy and marked for rehabilitation by the National Center for Health Facility Development, namely:

Amang Rodriguez Memorial Medical Center (ARMMC); East Avenue Medical Center (EAMC); National Center for Mental Health (NCMH); Tondo Medical Center (TMC); San Lorenzo Ruiz Women's Hospital (SLRWH); San Lazaro Hospital (SLH); Jose R. Reyes Memorial Medical Center (JRRMMC); Quirino Memorial Medical Center (QMMC); National Children's Hospital (NCH); Rizal Medical Center (RMC) and Bicutan Treatment Rehabilitation Center (BTRC); Philippine Orthopedic Center (POC); Dr. Jose Fabella Memorial Hospital (DJFMH); Valenzuela Medical Center (VMC); Las Piñas General Hospital and Satellite Trauma Center (LPGHSTC); Bataan General Hospital (BGH); NNC; PHC; and the LCP.

The COA said the recipient DOH-run facilities had deviated from the fund utilization guidelines and that there was no proof that the health agency had conducted a performance evaluation of the DOH facilities "to assess if the projects implemented have contributed to the attainment of the program's goals and objectives."

In one case, funds received by the NNC were transferred to regional offices (ROs) not affected by Ondoy. Of ₱22 million given to the NNC, ₱1.25 million was transferred to its various ROs to procure desktop computers, LCD projectors, and air conditioning units.

Furthermore, the COA noted that some of the recipient hospitals had entered into contracts "having questionable legal existence."

According to COA, some contractors' business permits had expired, while some had no permits at all. One contract had been notarized by a lawyer who was not a member of the Philippine Bar, it added.

COA clarified that while the DOH was not directly involved with the utilization of the released funds, the aforementioned SARO made it so that the DOH would be held accountable for the implementation of the projects.

CNN Philippines has contacted the DOH for a statement.