The Philippine International Trading Corp. (PITC) has returned a total of P5.2 billion to the Bureau of the Treasury (BTr) in the first half of 2021, according to a report to Finance Secretary Carlos Dominguez III.
The PITC’s remittance was in response to Dominguez’s request to the Department of Trade and Industry (DTI) last year for the state-run firm to return its interest earnings to the BTr and funds for projects that have not been bid out or for suspension, to help augment the government’s funds on COVID-19 response and disaster relief efforts.
According to a report by the Corporate Affairs Group (CAG) of the Department of Finance (DOF), the PITC also returned P1.89 billion to its client-agencies–the Technical Education and Skills Development Authority (TESDA), University of the Philippines (UP) Los Banos, UP System, Department of Health (DOH), among others–for projects identified as no longer necessary, and paid P1.82 billion to its suppliers from January to June this year.
As of end-June 2021, PITC’s fund transfers from different government agencies for various procurement programs amounted to P22.7 billion, down from the P31.6 billion balance as of end-2020, the CAG said in its report to Finance Secretary Carlos Dominguez III during a recent DOF executive committee meeting.
Military procurement accounted for P5.62 billion of the fund transfers, the procurement of various government agencies accounted for P16.6 billion, and P450 million were either savings or funds due for return or interest earned, the CAG said.
In a letter addressed to Trade Secretary Ramon Lopez last year, Dominguez said PITC’s interest earnings were recorded as interest income of the state-run firm, when these should have been remitted to the National Treasury.
These interest earnings came from the cash and investment balances transferred by several national government agencies to the corporation for the procurement of their various requirements.
Such fund balances, which are considered as trust liabilities of the PITC, amounted to P33.3 billion and P32.6 billion as of the end of 2019 and October 31, 2020, respectively, Dominguez said.
In response to the DOF’s request, PITC returned to the BTr P562.79 million in interest income on December 11, 2020, in addition to another P562.79 million remittance that PITC made in May 2020 in the form of dividends. This brings to P1.126 billion the total remittances of the PITC to the BTr in the form of interest income as of December 2020.
Dominguez told Lopez his request “is in line with our continuous efforts to identify sources of fiscal space and to accommodate the country’s various medical and social needs as a result of the pandemic, compounded by the successive calamities which recently hit the country.”
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