.: Sec Kulayan to brief Senate committee on remittance mess

BRIEF ON THE UNREMITTED CONTRIBUTIONS AND LOAN AMORTIZATIONS OF DEPED-ARMM

By Atty Jamar M. Kulayan, DepEd-ARMM Secretary

In the first week of the current administration, Officer-in-Charge Regional Governor Mujiv S. Hataman invited GSIS Trustee Mario J. Aguja and other GSIS officials for a conference with the school heads. During that conference, Trustee Aguja revealed that the burgeoning unpaid remittances and loan amortizations of DepEd-ARMM already amounted to the tune of 1.7B, as follows:

1. UNREMITTED CONTRIBUTIONS UNDER THE FIRST MOA IN 2004.

1. Period covered - July 1997 to December 31, 2003

2. Amount:

Principal 495,105,205.47

Interest 473,596,585.31

Total 968,701,790.78

After reconciliation, the principal amount was reduced to 450,963,264.03

3. Term of payment - 15 years

4. Interest rate - 12%

5. Funding - Whatever source

2. In FY 2006, Congress appropriated 250M for the payment but only 127M was utilize by the DBM solely for the payment of principal. The remaining 123M returned to the National Treasury.

3. Since the MOA signing, only 301,936,481.00 (127M from the amount appropriated by Congress and 174M from DepEd Savings in prior years) was paid. The last payment under this MOA was in April 2009 because of the dispute on the application of payments. DBM and DEPED-ARMM both wanted the payment to be applied to the principal. However, GSIS applied the payment to both the principal and the interest on the running balance, as follows:

	Principal	Interest	Total
Reconciled Balance	450,963,264.03	473,596,585.31	924,559,849.34
Less payments	66,169,816.14	235,766,664.86	301,936,481.00
Running Balance	384,793,447.89	237,829,920.45	622,623,386.34

2. UNREMITTED LOAN DEDUCTIONS for 17 months, e.g. October, November and December of 2001; November 2003; March, September, October, November and December 2004; and February, March, April, May, June, July, August and September 2005.

Year	Principal	Interest	Total
2001	41,769,054.86	104,107,530.29	145,876,585.15
2002	15,932,724.95	32,081,312.63	48,014,037.58
2003	99,397,564.21	179,949,206.39	279,346,770.60
2004	152,755,168.17	251,256,050.18	404,011,218.35
Grand Total:	309,854,512.19	567,394,099.49	877,248,611.68

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These figures do not include the loan deductions from DepEd Basilan personnel for April 2003 to September 2003 that were not remitted to GSIS. These figures are subject to reconciliation.

3. NON-MOA ACCOUNT. - Aside from item number 1, the contribution covering the period from January to March 2004 were both not paid and not included in the MOA of 2004, amounting as follows:

	Period Covered	Principal	Interest	Total
PS/GS	Jan. 2004 - Mar. 2004	64,712,281.20	126,256,284.59	190,968,565.79
Basilan	Jan. 2004 - Oct. 2005		16,771,415.85	16,771,415.85
Marawi	Jan. 2004 - June 2004		5,410,912.14	5,410,912.14
		64,712,281.20	148,438,612.58	213,150,893.78

4. BASILAN AND MARAWI ACCOUNT FROM REGIONS IX AND XII. - Aside from DepEd-ARMM’s obligations, there are also contributions or loan amortizations being collected from ARMM teachers who were previously under DepEd-IX for Basilan personnel and DepEd XII for Marawi City personnel, as follows:

	Period Covered	Principal	Interest	Total
Basilan	May 2003 -June 2004	9,940,765.67	30,200,420.27	40,141,185.94
Marawi City	Jan. 2003 - Dec. 2003	435,494.17	1,140,483.09	1,575,977.26
		10,376,259.84	31,340,903.36	41,717,163.20

5. Thus, the TOTAL AMOUNTbeing collected from DepEd-ARMM is now as follows:

MOA	622,623,386.34
NON-MOA	213,150,893.78
LOAN AMORTIZATIONS	877,248,611.68
BASILAN (DepEd IX)	40,141,185.94
MARAWI (DepEd XII)	1,575,977.26
	1,754,740,055.00

6. PENALTY FOR DELAYED PAYMENTS BY DBM. - As agreed upon in the first MOA between GSIS and DEPED-ARMM, it is DBM who will remit to the GSIS the contributions, both government and personal share, of the teachers of DepEd-ARMM. However, there are instances when DBM incurs delay in remitting the contributions for which GSIS imposed penalty. Thus, aside from interests, we also owe them:

Period of Delay	Penalty
April 2004 to Sept. 2011	160,391,188.56

7. ACTIONS TAKEN BY PRESENT ADMINISTRATIONS. - The present administration already entered into three (3) separates MOA with GSIS. The First MOA was for the Service Record Updatingso that billings from GSIS will be accurate and excess payments made by DepEd-ARMM in the previous years may be applied as payment to the total amount due from DepEd-ARMM. The Second MOA was for the payment of the Basilan Account under Item No. 3. The Third MOA was the settlement of theMarawi Account under Item No. 3.

8. UNPAID PAGIBIG CONTRIBUTIONS AND AMORTIZATIONS. - Aside from these unpaid GSIS contributions and loan amortizations, Home Development Mutual Fund recently wrote DepEd-ARMM for the collection of around 243M, viz:

PERIOD	PREMIUMS			LOAN AMORTIZATIONS	PENALTY			TOTAL
PERIOD	GOV’T.	PERSONAL	SUBTOTAL	LOAN AMORTIZATIONS	PREMIUMS	AMORTIZATIONS	SUB-TOTAL	TOTAL
OCT-DEC’01	121,600.00	5,365,000.00	5,486,600.00	26,480,598.27	21,104,976.00	12,425,950.59	33,530,026.59	65,497,224.86
OCT- DEC’02		430,800.00	430,800.00		1,499,184.00		1,499,184.00	1,929,984.00
JAN- SEP’03		1,292,400.00	1,292,400.00		4,264,920.00		4,264,920.00	5,557,320.00
SEP DEC’04	542,400.00	8,245,700.00	8,788,100.00	24,282,657.46	24,362,559.00	11,229,494.71	35,592,053.71	68,662,811.17
JAN NOV’05	1,904,000.00	12,502,400.00	14,406,400.00	33,452,704.30	36,517,008.00	14,198,249.06	50,715,257.06	98,574,361.36
JAN NOV’06	1,145,000.00		1,145,000.00		2,465,238.00		2,465,238.00	3,610,238.00
G. TOTAL	3,713,000.00	27,836,300.00	31,549,300.00	84,215,960.03	90,212,985.00	37,853,694.36	128,066,679.36	243,831,939.39

9. UNPAID PPSTA CONTRIBUTION AND AMORTIZATIONS. - The Philippine Public School Teachers Association (PPSTA) is also collecting 31M from DepEd-ARMM.

UNREMITTED LOAN PAYMENT	APR-DEC.’03	JAN-JUL’04	JAN-SEP’05	TOTAL
BASILAN	1,193,222.94	1,084,366.39	182,305.56	2,459,894.89
MARAWI	4,981,529.24	617,800.55	682,343.01	6,281,672.80
OTHER DIVISIONS			23,190,563.92	23,190,563.92
	6,174,752.18	1,702,166.94	24,055,212.49	31,932,131.61

10. GRAND TOTAL:

MOA	622,623,386.34
NON-MOA	213,150,893.78
LOAN AMORTIZATIONS	877,248,611.68
PENALTY (due to late payments made by DBM)	160,391,188.56
HDMF	243,831,939.39
PPSTA	31,932,131.61
GRAND TOTAL	2,149,178,151.36

Out of the grand total of 2.1B, the amount of 1.2B refers to penalty and interest alone.

11. RECOMMENDATIONS:

These figures are already beyond our capacity to pay. Aside from these amounts, we are still trying to solve the unclaimed backwages, salary differentials and adjustments of our teachers. Thus, we respectfully pray that immediate actions be undertaken by Congress, GSIS and DBM to help us solve these problems. More than the teachers who are still in active service but whose morale and dedication to service are affected, our retired teachers are in the losing end. They received less than the amount actually due them for retirement because their creditable service was reduced corresponding to the actual number of their unremitted contributions and are receiving lesser monthly retirement benefits. Unless we immediately act on these problems, they may not be able to fully enjoy the fruit of their long and dedicated government service.