The agency signed contracts for housing projects without having enough money set aside. This caused overspending and forced many projects to stop, wasting time and money.

Why It Matters

Recommended Actions

• Ensure that all contracts to be awarded to contractors for the proposed housing projects have sufficient funds, pursuant to Item 5.7 of DBM Circular No. 2010-9 dated December 30, 2010, by requiring Certificate of Budget Allocation prior to the awarding of contracts.

Original Audit Finding Excerpt

"The Authority entered into various contracts pending the release of funds from the National Government, resulting in allotment overdraft amounting to P17.995 billion as at December 31, 2022, contrary to the related provisions of Department of Budget and Management (DBM) Circular No. 2010-9 dated December 30, 2010 and EO No. 292, s. 1987 or the Administrative Code of the Philippines. In addition, the outstanding balances of all suspended housing projects totaling P25.670 billion, together with the outstanding balances of all on-going contracts totaling P12.497 billion as at the year-end, cannot be fully settled even if all the remaining balances of Special Allotment Release Orders (SAROs) totaling P20.172 billion were received by the Authority, resulting in the suspension of 80 housing projects, 26 of which pertain to Government Employees Housing Program (GEHP) and the Taal Volcano Eruption project, with contract costs totaling P28.274 billion due to lack of funds which, if not properly addressed, might lead to termination that would eventually result in wastage of time, funds, and resources."

Source Document