Findings No.6 COA Annual Audit Report 2005

July 26, 2008

6. Projects/Activities programmed under the 20% Development Fund in the total amount of P65,590,176.00 were not fully implemented during the year thus, deviating the development objectives of the provincial government and depriving the constituents the benefits that may be derived there from.

Section 287 of Republic Act No. 7160 provides that:

“Local Development Projects- Each local government unit shall appropriate in its annual budget no less than twenty percent (20%) of its annual internal revenue allotment for development projects. Copies of the development plans of local government units shall be furnished the Department of Interior and Local Government“.

At least 20% of the Local Government Units allocation in the national tax must in turn be allocated for development projects (socio-economic projects that may develop resources, people’s income, employment, etc.) as may be formulated by local development council. This should be mandatory (the 20% allocation) because the LGU might use the total allocated share in just maintaining traditional services (including salaries of personnel) that cannot be categorized as developmental in character.

The Provincial Government had program in its Annual Development Plan the amount of P65,590,176.00 for various projects and activities for the benefits of the constituents.

Per evaluation, it was noted that projects and activities programmed for the 20% development fund were not fully implemented (please see Annex J).

The non-implementation of the said projects would be disadvantageous to the provincial government considering that prices are constantly increasing and the benefits derived there from could not be immediately enjoyed by the constituents.

Concerned officials justified that some projects were not implemented because of the following vital reasons:

Failure of the bidding since the Approved Agency’s Estimates (AAE) was very much lower than that of the bidder’s estimate due to price adjustments.

Most of the equipment were utilized for MIRIDP implementation.

Partial purchase of computer hardwares, will be installed once new capitol building is in place.

RECOMMENDATION

Implement fully projects and activities funded out of the 20% Development Fund to attain its goals and objectives beneficial to the constituents

Written by admin · Filed Under Commission on Audit, Lanao del Norte