After pork scam, bill requires audit of NGOs

MANILA, Philippines – To avoid a repeat of the pork barrel corruption scandal, a senator has proposed a measure requiring a government audit of non-governmental organizations (NGOs) receiving taxpayers’ money.

Senate blue ribbon committee chairman Teofisto “TG” Guingona III filed a bill that seeks to prevent bogus NGOs from accessing public funds by setting a strict accreditation and validation mechanism.

The filing of the measure is in line with the recommendations of Guingona’s committee to pass legislative reforms after investigating the scam, which implicated 3 opposition senators who had been arrested and detained. (READ: 5 steps to prevent next Napoles scam)

In the explanatory note of Senate bill 2375, Guingona said one of its “landmark features” is the audit of NGOs and People’s Organizations (POs) which receive government funds.

Section 10 of the bill provides that, “In addition to accreditation, NGOs/POs that are public fund recipients, shall be subject to audit. The Commission on Audit (COA) shall audit NGOs/POs that implement programs and projects using public funds received from any government organization, in accordance with the Commission’s pertinent rules and regulations.”

The bill, titled "NGO Accreditation for Government Fund Releases Act," also designates the Department of Social Welfare and Development (DSWD) as the “central accrediting and repository agency” that will issue a “seal of good housekeeping.”

The DSWD will vet the NGOs through a stringent process and list of requirements. The department will also maintain a database for accredited NGOs and POs.

“The passage of this bill will enhance transparency, accountability and good governance in the allocation and utilization of public funds by ensuring that only legitimate entities that have good reputations for integrity, established track records and proven contributions to the betterment of society, would be able to participate in government projects,” Guingona said.

The COA report and Senate investigation on the scam revealed how loopholes in the accreditation system allowed the bogus NGOs of alleged mastermind Janet Lim Napoles to siphon off millions of pesos in development funds in connivance with lawmakers and agency officials.

Senators Ramon “Bong” Revilla Jr, Jinggoy Estrada, and Juan Ponce Enrile were implicated in the scandal and now face plunder charges over the country’s biggest corruption scam in recent history.

No more names from phonebook

During the Senate inquiry, whistleblowers testified that they were able to get NGOs accredited with government agencies even with interlocking incorporators, some of whose names they got from relatives. They also said they made up the list of beneficiaries from names in phone books, and board and bar exam passers.

To prevent this, the proposed measure requires applying NGOs and POs to meet the following criteria:

To help the DSWD in the accreditation process, it is mandated to collaborate with the Department of Budget and Management (DBM) and private sector stakeholders like the Philippine Council for NGO Certification (PCNC).

The PCNC is a self-regulatory body that certifies NGOs applying for donee institution status. This means accredited NGOs can receive tax-deductible or tax-exempt contributions under the law.

On-site monitoring, not just paper checking

The bill also aims to address a key finding of the inquiry: that implementing agencies merely rely on documents to check NGOs’ legitimacy.

The measure requires agencies to validate reports of the NGOs through on-site assessment and field interviews.

Instead of a post-audit mechanism, the bill also prescribes that NGOs and POs submit every month a Fund Utilization Report to the agency and the DSWD.

The bill mandates the posting of all programs and projects that NGOs and POs implement using public funds, including the status of the project, on the websites of the government agency, the Philippine Government Electronic Procurement System (PhilGEPS), and the NGO or PO. 

NGOs and POs that fail to complete the program or liquidate the funds will face the penalty of suspension or revocation of accreditation, disqualification, and possible civil and criminal liabilities.

Read the bill here:

– Rappler.com