Despite his promise to give an explanation regarding the City’s financial status, suspended Cebu City Mayor Michael Rama did not tackle the matter during his press conference yesterday.
Interviewed last night, Rama said he allowed City Treasurer Diwa Cuevas to take care of the city’s finances, saying she had his “full trust and confidence.”
“Everything was being centralized in terms of how money is being managed,” said Rama.
“As far as I am concerned, never was I told ever since that there is financial disarray. Maybe the one making that statement is the one in mental disarray,” Rama added.
Rama admitted that he could not answer questions on the city’s finances because it is “Cuevas who could do it better.”
Cuevas, however, did not show up for the press conference that Rama called yesterday. Neither did City Attorney Jerone Castillo nor Mayette Gumiya, both members of the local finance committee.
Meanwhile, Acting Cebu City Mayor Margot Osmeña wants a copy of the city’s bank balances in order to ascertain if there are other money placed on time deposit and if so, who allowed such deposits.
“Is it (money) really there? Is it (the money) really on a time deposit?” Osmeña asked.
She also questioned why P48 million in Pagcor funds was placed on time deposit when the amount could have been used for the delivery of services.
Cuevas explained that putting the Pagcor funds on time deposit had been done previously, even before she became city treasurer.
Former City Treasurer Ofelia Oliva, during her stint, placed about P165 million in City Hall funds in two time deposit accounts which matured after five years.
The two time deposits already matured in December 2015 and January 2016 respectively.
Cuevas said the entire amount given by Pagcor monthly to the city is never fully utilized because request for funds, usually from the barangays, takes a long time to process.
“The requests have to pass through the office of the mayor, then to the Council for approval of charging and then to the Accounting Office for prioritization. The P4 million a month is not always used up for these request,” Cuevas said.
According to Esterlita Garrido, local revenue collection officer 3 of the City Treasurer’s Office (CTO), the Pagcor funds are in two time deposit accounts. One is in BDO at P48 million while the other is in Land Bank of the Philippines at P42 million.
“This wasn’t started by me. Even the previous treasurers have done it. I didn’t change any procedure. I just continued it. It’s renewable monthly, anugon man kaayo nga wala pa siya’y gamit (it would be a waste since it’s not being used yet), might as well place it in time deposit,” Cuevas said.
If there is a need to use more Pagcor funds, she said it can just be accessed when it matures after 30 days.
Osmeña said she received reports that the city’s time deposits could be used by certain individuals at City Hall for “back to back transactions.”
She said this means that the depositor may have used the city’s time deposits as an “accommodation” with a depository bank in exchange for availing of a personal loan.
Osmeña said she was advised by some people whom she did not want to name that this could be an ongoing practice at City Hall.
But Rama said, “They (Osmeñas) should not be suspicious. Only those doing it will look at it as being suspicious. We have been transparent in all our dealings.”
Based on city’s May 5 daily report, Cebu City now has about P8.4 billion cash in bank. Of the amount, P7.6 billion was placed under the general fund, P598 million was under the city’s trust fund account, 238 million as Special Education Fund and P16 million as “barrio fund.”
The P598 million trust fund includes the P48 million Pagcor funds placed on time deposit that matures every month and earns a one percent interest per month.
City Hall receives a P4 million per month from the operation of Pagcor casinos in the city.
Under Pagcor guidelines, Pagcor funds can be used for self-sustainable livelihood projects, scholarships, infrastructure projects that are essential to the community and projects connected with the delivery of basic health services.
The funds may also be used for projects intended to prevent widespread diseases or epidemics, de-clogging of and collection of garbage in sewers and canals and construction of sanitation facilities in depressed areas.
In December 2014, the Bando Osmeña-Pundok Kauswagan (BO-PK) dominated Council passed a resolution authorizing the creation of an ad hoc committee that would to review projects and programs charged to the city’s share of Pagcor funds, which they said is one of the city’s “most abused source of funding.”
Councilor Eugenio Gabuya Jr., head of the ad hoc committee, said in an earlier interview that the ad hoc committee will coordinate with then Mayor Michael Rama in making sure that all charges made to Pagcor funds are properly implemented.
Gabuya said that several projects charged to Pagcor funds and approved by the City Council have not been implemented by the executive department.
A day after her appointment as acting mayor, Osmeña wrote the Commission on Audit (COA) Cebu City office requesting for a cash audit of the city’s disbursing and special disbursing officers in the “interest of public transparency and accountability.”
Osmeña sent a separate letter asking the Bureau of Local Government Finance in Central Visayas (BLGF 7) to conduct a separate audit of all funds under the City Treasurer’s Office (CTO).
The COA cash audit already started on Thursday but its results remain unavailable. The BLGF audit is yet to start next week.
“I wanted to compare our daily cash balance with the actual bank balance. I want to see if it’s the same,” she said.
Osmeña said it is possible that there are discrepancies in the city’s daily cash report in comparison with the actual bank balance which she is yet to see.
The acting mayor recalled an instance in the past when she asked Cuevas why a certain appropriation, which she could not exactly recall what, could not be found on the city’s daily cash report.
Cuevas had told her then that she only made a recording of the said amount under the city’s reserves.
Osmeña said that if a bank balance is made available, she would already be able to determine how much money the city actually had upon her assumption to office on May 17 and see a breakdown of such deposits.
The bank balance, which is a more detailed recording of the city’s cash flow, would also aid her in identifying the city’s accountable officers.
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