The agency entered into contracts without sufficient funds, causing overdrafts and inability to pay, leading to project suspensions and potential waste of resources.

Why It Matters

Recommended Actions

• Management: a. 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.
• And b. Ascertain that all contracts to be entered into are within the total allotments released by the DBM, pursuant to Section 41, Chapter 5, Book VI of EO No. 292 or the Administrative Code of the Philippines, by dividing the budget for each RO/DO and informing them their respective budgets for operation so that every RO/DO is aware of their remaining budget limit as of a given period.

Original Audit Finding Excerpt

"After a decade of the Yolanda Permanent Housing Projects’ (YPHP) implementation, only 171,230 housing units (HUs), representing 84.75 per cent of the revised target of 202,036 HUs have been completed. The slow progress has been primarily attributed to suspensions, delays, terminations, budget realignments, and budget constraints of the projects, depriving beneficiaries of their homes that were destroyed by Typhoon Yolanda. Furthermore, the low occupancy of the YPHP caused by challenges related to transportation access, inadequate livelihood opportunities, insufficient access to water and electricity, and the use of substandard materials in the construction of the HUs caused its fast deterioration of unoccupied HUs. We recommended that Management require the concerned departments to minimize the delays in the project implementation and ensure the immediate completion of housing units by: Ensuring full coordination with the concerned government agencies, particularly the LGUs and Depa"

Source Document