MANILA, Philippines - The military on Thursday said it welcomes a probe into the so-called pabaon (send-off) system wherein outgoing Armed Forces chiefs of staff are given millions of pesos in cash when they retire.

In an interview, Armed Forces spokesman Brig. Gen. Jose  Mabanta said the pabaon system was discontinued after the military leadership abolished the office of the AFP deputy chief of staff for comptrollership (J6) in 2004.

“A lot of things has happened to the comptroller. From a very big office, it was divided into smaller offices. One of the intentions of this is to show there is check and balance, not one office will decide on the financial issues,” said Mabanta.

“If this will result to investigation, additional or further investigation, the Armed Forces will give in and provide whatever is requested from us by competent authorities,” he added.

The abolition of the Office of the Military Comptroller (J6) came after former military comptroller Maj. Gen. Carlos Garcia was discovered to have amassed over P300 million during his time as head of the office.

The abolition paved the way for the creation of the office of the AFP Resource Management Office, office of the AFP Management and Fiscals Office, and the office of the AFP Internal Auditor.

On Thursday, former military budget officer Lt. Col. George Rabusa said former AFP chief of staff Angelo Reyes received about P50 million from the military when he retired in 2001.

Testifying before a Senate inquiry on the Garcia plea bargain deal, Rabusa said it is a practice in the AFP to give send-off money or "pabaon" to retiring chiefs.

Rabusa said he and his direct superior, former comptroller Jacinto Ligot, personally handed the money to Reyes in his office in Camp Aguinaldo.

Ligot, meanwhile, said he cannot recall the incident while Reyes said he had no recollection of receiving P50 million from Rabusa.

"I do not recollect yung sinasabi ni George Rabusa na pumunta siya sakin at nagbigay nung sinasabi niyang P50 million," Reyes said.

Rabusa said 2 succeeding chiefs of the Armed Forces also received send-off money. He identified the 2 as generals Diomedio Villanueva and Roy Cimatu.

'Pabaon' came from 'conversion'

Mabanta, meanwhile, said the statements of Rabusa, his classmate at the Philippine Military Academy Class of 1981, were probably raw.

“It's up to him. Anyone can say what he wants but these are raw information, which I think needs to be further verified. It's really up to the authorities to find out its veracity and truthfulness,”said Mabanta.

When asked if the military will take action against the former AFP chiefs who received the pabaon, he said: “At this point, we will wait for the development within the next few days.”

He said the military will remain transparent after Sen. Antonio Trillanes IV said he wants to subpoena procurement documents during the time of Garcia  as AFP comptroller.

A military official, speaking on condition of anonymity, said the cash gifts given to the former AFP chiefs are taken from the illegal “conversions," including the ghost or incomplete delivery of military equipment and supplies.

He, however, said the conversion and the pabaon practices stopped after the reform measures were adopted following the Garcia corruption case.

But another officer, with a deeper background on the comptrollership and logistics, said the conversion and the pabaon system still persist.

The officer welcomed the expose of Rabusa, saying: “The organization needs this for it to improve, so for institutional change.”

“I'ts still there. They have the cash that is difficult to trace. That is where they got the pabaon. These are from the proceeds of conversion. Before the Garcia case, conversion was centralized (through J6) but now, it's already decentralized,” he said.

“This (pabaon) boils down to that conversion, system of conversion in the Armed Forces…This includes the ghost deliveries,” he said.

'Conversion' proceeds not all bad

The source gave an instance where a conversion is consummated. “If you order P10 million worth of medicine, the supplier will deliver only P5 million worth and the other P5 million will be in the form of cash but he (supplier) will sign the delivery receipt for P10 million. That’s a conversion. In some cases, there are no delivery, ghost delivery,” he said.

The source said that in some instances, conversion is not bad because the proceeds of these are used to finance activities that are not programmed or have not been defended during budget deliberations in Congress.

“That actually depends on how you spend the proceeds of conversion. Conversion is just a mechanism. For example, you have an activity that is not programmed but you have to execute that activity. If you get the money allocated for a program that is not important and channel it to fund the important program. That is conversion,” he said.

He said the Provision Command-Directed Activity usually occurs at the level of AFP general headquarters and Department of National Defense (DND) level.

He said PCDA funds are pooled from funds of different military units involving, the personnel, intelligence, operations, logistics and plans and programs. “The releases of the money must be approved by the chief of staff,” he said.

He said money are drawn from the units by the office of the AFP because “they have to anticipate needs that are not programmed…like the giveaway (gifts) of the chief of staff, if he treats for pizza. those are not programmed,” he said.