Top 10 wealthiest LGUs compliant to development fund guidelines except Davao City
Metro Manila (CNN Philippines, October 18) — The Commission on Audit (COA) found the top 10 wealthiest local government units (LGUs) in the country spent their 20% development fund for 2022 in accordance with guidelines except for Davao City.
A review of compliance audit reports for each LGU showed auditors commended the following cities for their proper utilization of the development fund: Quezon City, Makati City, City of Manila, Pasig City, Taguig City, Mandaue City, Cebu City, Mandaluyong City, and Parañaque City.
However, Davao City was found to have inappropriately charged around ₱6.4 million worth of expenses to the development fund.
“As a result, the purpose for which the fund has been established was defeated and the optimal utilization of the fund was not achieved,” COA said.
The flagged expenditures include food and catering services (₱125,000), payment of cash prizes for the Davao sports festival (₱1.8 million), and financial assistance given to centenarians (₱3.2 million).
Davao’s budget and accounting office explained management assumed the flagged expenses were considered general welfare items and can be charged to the development fund.
A joint memorandum circular issued by the budget, finance and interior and local departments states that LGUs must allocate in their annual budget no less than 20% of revenues for development projects. The guidelines state certain expenditures should not be charged to the development fund such as salaries, office supplies, meals, and maintenance or repair.
“Had the management properly identified the specific projects and carefully evaluated the corresponding expenditure items and ensured that these are allowed to be charged against the development fund, the foregoing ineligible disbursements could have been avoided,” state auditors noted.
They recommended that the city finance committee reevaluate current programs funded by the development budget and reverse the ineligible items.
During the exit conference, Davao City management assured COA that it will align succeeding budgets to comply with rules and regulations.
Davao City’s 2022 development fund amounted to over ₱2.1 billion, mostly spent on road
