COAble: Supreme Court upheld COA’s decision to disallow certain Philhealth benefits

In 2007 to 2008, Philhealth granted its officials and employees certain benefits that according to the Commission on Audit (COA), and upheld by the Supreme Court, is disallowable.

Among these disallowed benefits are the following:

• Efficiency gifts;
• Birthday gifts;
• Special events;
• Nominal gifts;
• Education assistance;
• Project completion benefit;
• Payment of liability insurance premium;
• Corporate transition and achievement premium; and
• Medical mission critical allowance.

These benefits were disallowed as there was no prior approval from the Office of the President before payment of the same – in violation of Memorandum Order No. 20 of June 2001, and Administrative Order No. 103 of August 31, 2004.

The aforementioned Memorandum Order suspended the grant of any salary increases and new or increased benefits such as, but not limited to, allowances; incentives; reimbursement of expenses; intelligence, confidential or discretionary funds; extraordinary expenses, and such other benefits not in accordance with those granted under Salary Standardization Law (SSL). Said suspension covers senior officer level positions, including Members of the Board of Directors or Trustees.

Further, the Order states that any increase in salary or compensation of GOCCs/GFIs that are not in accordance with the SSL shall be subject to the approval of the President.

Philhealth tried to appeal saying that these benefits were granted in good faith; however, the Supreme Court was not convinced and instead reiterated COA’s decision that granting these benefits requires prior approval from the President. The law has long been existing; hence, the high Court did not allow Philhealth to claim ignorance on the same.

Source: SC affirms COA disallowance of P204-M PhilHealth benefits by Rappler.com | February 9, 2021

We at GABOTAF are documenting these audit findings (tagged as COAble) so as to help our colleagues take note of them and hopefully avoid them in their respective Offices.