CEBU CITY, Philippines - At least P2.1 million in refunds were required from officials and employees of Moalboal town, southwest Cebu to pay for the excess cash incentives they received last year.The Commission on Audit in Central Visayas (COA-7) also directed Moalboal municipal officials to explain why they authorized the release of the appropriation which exceeded the 55-percent Personnel Service (PS) limitation in their budget. An extra cash gift of P20,000 each or a total of P1.2 million was released to municipal officials and employees in 2007 along with P15,000 each or about P900,000, which reportedly formed part of their Collective Negotiating Agreement (CNA) incentive. The COA said the Moalboal municipal government was only allowed to disburse P16 million of their annual budget of at least P29 million for their PS. The release of the CNA incentive on the same year that the employees organization registered with the Civil Service Commission (CSC) violates the Budget Circular 2006 passed last February 1, 2006. The circular states that any cash incentive should be taken from savings incurred during the year that the organization underwent review. Since the CNA was signed on January 2, 2007 and will be in effect until January 2, 2010, any incentives should have been released this year. Regional auditors also said no supporting document was attached to the claims on the sources of funds from cost-cutting measures. They said this rendered the grant of cash benefits illegal. The COA-7 said no reply was sent by the officials in response to their queries on the incentives. Moalboal Mayor Yvonne Cabaron promised the COA-7 that she will discuss the matter with fellow officials on the subject. The agency likewise called on Moalboal officials to find ways to earn income from the heavy equipment they purchased worth P6.4 million. The purchase came from the P13.5-million loan the Moalboal municipal government secured at the Land Bank of the Philippines. These equipment consist of a hydraulic breaker worth P1.5 million and one hydraulic backhoe loader worth P4.9 million.
Interest rate is at 9.75 percent which is still subject to quarterly repricing and is payable in five years. COA said the purchase lacked a project proposal that would have justified the purchase. COA said that while it was unclear how the equipment will be used, the municipal government already paid in 2007 a total of P870,636 as interest of the loan. Interest for the loan is computed at P2.8 million for the next five years. Auditors said they were surprised with the LBP loan since the budget for heavy equipment was already included in the 20 percent development fund. Mayor Cabaron told COA-7 that the loan was needed for their road projects. An ordinance would be enacted later to fix the rate for the rental of these equipment. Still regional auditors said the excess cash should have been used to finance other projects for Moalboal town. /Reporter Doris C. Bongcac | 
