Ermita washes hands of Malampaya scam
MANILA - Former Executive Secretary Eduardo Ermita on Friday said he had no idea how the Malampaya funds were disbursed by the implementing agency.
In a phone interview with ABS-CBN, Ermita reacted to the plunder complaint lodged against him, former President Arroyo and other former Arroyo Cabinet officials for the alleged misuse of the Malampaya funds.
Whistle-blowers in the scam did not mention Arroyo and Ermita but Justice Secretary Leila de Lima yesterday said Arroyo was implicated because her "leniency."
She said Executive Order No. 848, which Mrs. Arroyo signed, allowed the Department of Budget and Management to use the Department of Energy's special funds for any project authorized by Mrs. Arroyo.
De Lima said the hastily issued EO "invalidly liberalized the exploitation of the Malampaya fund for purposes not contemplated by existing laws."
Ermita was implicated because it was he who signed a memorandum to then Budget Secretary Rolando Andaya regarding the release of the funds.
"I do not know definitely. I guess it's the perception of others based on my memo to secretary of budget that was the basis na include ako. The way it was written it started the ball rolling," Ermita said.
He added: "I have no knowledge how this was supervised at the agency that received the fund. I just emphasize among my job as executive secretary is to relay presidential instructions to the appropriate Cabinet secretary."
The former Cabinet official said the Special Allotment Release Order (SARO) and the Notice of Cash Allocation (NCA) covering the release of the Malampaya funds both required the agencies to conform to the appropriate rules.
Ermita maintained that President Arroyo's order to release the funds had legislative cover.
"Definitely the president will not authorize or give approval until and after there is reference to Presidential Decree (910) section 8 which stated purpose for which funds generated could be utilized. It specifically stated that as the president may direct or may determine as to the utilization of such fund, the president will not give authorization or approval until she's sure it's based on existing presidential decree."
In his September 21, 2013 statement, Ermita recalled the Malampaya fund was used for the rehabilitation of those devastated by typhoons in 2009.
"Within a one-week period from 26 September to 1 October 2009, our country was hit by two devastating typhoons, Ondoy and Pepeng. According to a post-disaster needs assessment (PDNA) conducted by the Asian Development Bank, the total cost of recovery and reconstruction would be US$ 4.42 Billion (or P190 Billion). Commenting on these costs, the Bank warned that 'the needs for financing are large, but the cost of doing nothing would be larger still.'"
Ermita recalled that then President Arroyo issued Proclamation 1898 on 2 October 2009, declaring a state of national calamity over the entire country. She also held a series of Cabinet meetings during the first half of October to determine the appropriate response and resources required.
Over this period, the various Cabinet members submitted their respective funding requirements for recovery and reconstruction. This included the P900 million submission by the Department of Agrarian Reform (DAR) .
The Arroyo government based its actions on Presidential Decree 910, dated 23 March 1976, as well as the pertinent provisions of the General Appropriations Act of 2009.
Presidential Decree 910, Section 8 thereof provides as follows: "All fees, revenues and receipts of the Board from any and all sources, including… the government share representing royalties, rentals production share on service contracts and similar payments on the exploration, development and exploitation of energy resources, shall form part of a Special Fund to be used to finance energy resource development and exploitation program and projects of the government and for such other purposes as may be hereafter directed by the President."
Ermita admitted that he wrote to DBM Secretary Rolando Andaya relative to the approval of the President to use part of the special account in General Fund (Fund 151) of the Department of Energy "in such amounts as may be necessary for the relief operations, rehabilitation, reconstruction, and other works and services to areas affected by the calamities."
He said that on October 22, 2009, Undersecretary Narciso Nieto, acting as DAR Officer in Charge, wrote to Andaya in order to formally request and justify the release of the P900 million. On November 19, 2009, Secretary Andaya issued the related Special Allotment Release Order (SARO) for the requested amount.
"On 21 December 2009, Secretary Andaya wrote the Secretary of DAR advising him about the issuance of the related Notice of Cash Allocation (NCA) to cover the SARO. Specifically stated in the NCA is the instructions about utilizing the funds subject to the existing budgeting, accounting and auditing rules and regulations."