Budget Watch

COA: NHA housing contracts exceeded approved budget

COA: NHA housing contracts exceeded approved budget
The National Housing Authority says the projects are covered by multi-year contract authority, but state auditors say a new budget should be allotted for new projects

The Commission on Audit (COA) flagged the excessive committed contracts of the National Housing Authority (NHA) for housing projects worth beyond the annual budget approved by Congress.

In an audit report released on Friday, October 8, state auditors found that the NHA had P18.381 billion worth of contracts for military and police shelters as of December 31, 2020 – an overcommitment of P12.66 billion beyond the P6.563-billion budget.

Contracts for informal settler families’ relocation housing – amounting to P10.82 billion between 2017 and 2020 –  also exceeded the approved budget of P9.979 billion.

The NHA, in response, said the full projects were covered by multi-year contract authority (MYCA), and that the NHA general manager can realign projects provided that the amount does not exceed the budget provision for capital outlay under the corporate operating budget (COB).

COA, however, said a new annual budget should be allotted for new projects, and also pointed out that the 2021 budget bore no approved new funding for unfinished housing projects for police and the military.

“We reiterate that the COB for the succeeding year is intended for new projects, thus, funding the contract cost of project is not continuously given MYCA since the budgets for the subject projects are with negative cash balances,” the commission said.

Unfinished housing projects

The housing projects for law enforcers were first launched during the Aquino administration in 2010 as part of the 2011-2016 Philippine Development Plan.

It was later renamed the 2017-2022 Public Investment Program (PIP) in 2017 under the Duterte administration.

In 2016, the size of the allotted house and lot was expanded to 60 square meters from 22 square meters, thus hiking the cost per unit to P2.091 million from P1.015 million.

This meant that the number of recipients had to be reduced.

“One year short of the PIP implementation, only 2,788 house and lot packages were completed out of total 10,455 house and lot packages contracted by the authority, or short by 38,617 housing units,” COA said. – Rappler.com