COA Flags Cebu City for Unused P1.4B Disaster Fund

CEBU CITY, Philippines — The Commission on Audit (COA) has raised concerns about Cebu City’s Local Disaster Risk Reduction and Management Fund (LDRRMF). In its 2023 report, COA revealed that the city failed to utilize P1.456 billion from its disaster fund for the years 2022 and 2023.

COA highlighted that this non-utilization undermines the fund’s purpose of bolstering disaster preparedness and response capabilities. The LDRRMF, intended to support disaster preparedness and mitigation projects, had P129,353,831.56 allocated in 2022 and an additional P1,455,856,661.59 in 2023.

However, by the end of 2023, these funds remained largely unspent, with many projects still stuck in procurement or approval stages. This inaction has rendered the city’s annual investment plans ineffective, leaving it vulnerable to disasters.

Legislative Framework and Fund Allocation

Republic Act No. 10121, the “Philippine Disaster Risk Reduction and Management Act of 2010,” mandates that at least five percent of a local government’s estimated revenue be allocated to the LDRRMF. This fund is meant for pre-disaster preparedness, life-saving equipment purchases, and post-disaster recovery.

In compliance with this law, Cebu City allocated P2,485,152,373.70 for its LDRRMF in 2023.

Delays and Procedural Bottlenecks

A review of the summary of appropriations, allotments, obligations, and balances as of December 31, 2023, showed that P1,455,856,661.59 of the capital outlay remained unimplemented. Similar issues were observed in the 2022 appropriation.

Discussions with the City LDRRM Office revealed several factors causing these delays, such as bureaucratic red tape and procedural bottlenecks. Many projects, including the procurement of multi-tool hydraulic rescue tools and a boom truck, remain in the post-qualification stage. More recent procurements, like advanced radar life detectors and a truck-mounted aerial platform worth P65,952,000.00, are also awaiting approval.

An examination of fund utilization over the past five years showed a consistent pattern of low utilization, with some capital outlay for 2017 only reaching full utilization three years later.

Recommendations and Contributing Factors

COA identified several management control issues contributing to the delays, including complex approval processes, poor inter-departmental coordination, and frequent leadership changes within the DRRM Office.

The COA recommended that Cebu City streamline its procedures to address these bottlenecks. It also suggested developing a clear strategy to ensure effective coordination between departments involved in disaster-related projects, outlining specific roles and actions to prevent further delays.

“We reiterated our recommendation that the City refrain from funding projects that are not procurement/implementation-ready, to ensure timely delivery of projects and address the public infrastructure gap,” the COA report stated.