COA flags P2 billion worth of DOT transactions under Wanda Teo

From official junkets to advertisements placed on television networks, the Commission on Audit has found irregularities in more than P2 billion worth of transactions the Department of Tourism made under the leadership of former Secretary Wanda Teo.

Teo, who resigned from the DOT in May following the controversy over a P60-million DOT ad placement on her brother Ben Tulfo's program, managed to travel to five international destinations last year.

In its 104-page audit report, COA said Teo traveled to Berlin, Germany; Bangkok, Thailand; Istanbul, Turkey; Singapore, and South Korea last year ,where she received a total daily subsistence allowance of P857,961.95.

COA said Teo and 93 other DOT officials incurred traveling allowances amounting to P19.29 million despite the lack of specific guidelines from the central office, "thus exposing the government to risks of incurring expenditures for excessive and extravagant travels abroad."

Other officials named in the report include Undersecretaries Benito Bengzon Jr., Rolando Canizal, Katherine De Castro, Alma Rita Jimenez, Falconi Millar, and Assistant Secretaries Frederick Alegre, Reynaldo Ching, Maria Lourdes Japson, and Daniel Angelo Mercado.

COA said DOT must issue guidelines for foreign trips due to the number of officials who traveled. The DOT, in response, said it adhered to the recommendation through a department order dated January 10, 2018.

Experience Philippines

COA also flagged the DOT's P271.7-million disbursement for its controversial "Experience Philippines" campaign with McCann Worldgroup Philippines Inc., and its inconsistencies in payments for its branding campaign. This represents 42 percent of the P649-million contract cost DOT entered with the ad firm.

COA said DOT approved the release of funds even if McCann had yet to submit documents required under its Terms of Reference (TOR) such as a comprehensive international media plan, implementation strategy, success rate metrics, cost estimate, and proof of production.

"The non-submission of the said documents precludes the verification of the regularity of the payments made, particularly the determination of whether or not the services were satisfactorily rendered by the media and advertising agency," the commission said.

In June 2017, DOT cancelled its contract with McCann following the controversial "Sights" advertisement.

COA also found deficiencies in the memoranda of agreement between DOT and international networks Cable News Network Inc., Discovery Networks Asia-Pacific, and British Broadcasting Corporation with a total obligated amount of P204 million.

COA said the availability of funds were allocated in 2016 but the MOAs were only signed in December 2017. All MOAs also had irregularities on deliverables, payment schedules, and project duration.

DOT management said it has requested the suppliers to submit warranty securities but these networks said such warranties were not part of standard business practice. COA, however, insisted that project deliverables should be stated in the MOAs.

Inadequate performance indicators

State auditors also said they were unable to assess the effectiveness of the DOT's other locally funded marketing programs due to inadequate performance indicators.

These programs, activities and projects had a total appropriation of P847.2 million, but COA said it is unsure how they boosted Philippine tourism and tourist arrivals.

The commission said DOT had informed it of its successful programs where it exceeded its target on the increase of tourist arrivals and tourism revenue. COA, however, said the agency seemed to have only identified the projects' long term benefits but not the short term rewards.

"Assessing as to whether to continue, revise or discontinue the PAPs (programs, activities, and projects) would prove to be difficult if no sufficient monitoring tool is provided to evaluate its short and medium term accomplishments in achieving the agencies mandate of increasing the number of tourist arrivals and promoting Philippine tourism," COA said.

COA said DOT agreed with its recommendation to direct the Office of the Tourism Development Planning, Tourism Regulation, Coordination and Resource Generation and the Office of the Administration and Special Concerns to set performance indicators and targets for the government to assess the sustainability of tourism programs.

Non-monitoring of Tourism offices

Twelve foreign Philippine Tourism Offices (PTO) in the United States, China, South Korea, Japan, Germany, Taiwan, Australia, and the United Kingdom received P605 million in total cash advances last year.

These offices conducted or participated in several exhibitions worldwide to promote Philippine tourism and are under the Tourism Development Planning Sector for the implementation of plans and programs and the Administration and Special Concerns Sector for the planning and monitoring.

COA, however, said no oversight body was formed to monitor if the funds received were properly used and no specific division in charge of consolidating plans, targets, and accomplishment reports of the tourism offices.

"Given the considerable funds being spent for PTO operations, adequate monitoring and supervision should be conducted to enable the agency to determine the current status of PTO PAPs, identify which activities should be prioritized, and assess whether the PAPs of PTOs were efficiently and effectively achieved and the expected benefits were gained out of money spent by the government," it said.

DOT informed COA that a department order will be issued creating a composite team to undertake the monitoring and evaluation of the PTO pgrams.

Other transactions questioned in the COA report include the P120 million in ad placement on state-run People's Television Network, sponsorships worth P19.5 million to non-government organizations, and the P3.7 million worth of withdrawals from Duty Free Philippines that were deducted from DOT's net income shares. — BM, GMA News