373 Phil. 642
MENDOZA, J.:
Performance Awards P140,900.00The disbursement was suspended by State Auditor Lourdes S. de la Cruz for lack of authority from the DBM to use savings of PDDCP for the payment of incentive awards and for lack of approval from the Civil Service Commission (CSC) of proposed guidelines for the grant of the awards. In her letter, dated September 2, 1991, State Auditor de la Cruz stated:
Loyalty Awards 379,200.00[2]
Total P520,100.00
This has reference to the justification submitted to this Office for payment made to officials and employees of the Center representing their incentive cash awards CY 1990 in the total amount of P509,950.00 which were suspended in post-audit.Accordingly, on September 20, 1991, petitioner wrote then DBM Secretary Guillermo N. Carague for authority to use savings of PDDCP for the payment of performance and loyalty awards. On September 23, 1991, she wrote then CSC Chairman Patricia A. Sto. Tomas seeking approval of the guidelines for the grant of the same.
The said justification narrated Section 27 of Republic Act No. 2260; Section 33 of Presidential Decree No. 807; Section 35 of Executive Order No. 282; Sections 18 and 19 of the Rules, Regulations and Standards on Employee Suggestions and Incentive Award System by the Civil Service Commission and Sections 1, 2, 3, 6 and 7 of Rule V of Republic Act No. 6713.
The above-mentioned provisions of laws which were made as the basis for giving incentive cash awards were already considered in post-audit since said laws were enumerated as part of the memorandum issued to officials and employees of PDDCP for their guidance in receiving their cash incentive award.
It may be mentioned that the above laws authorized the head of agency to incur expenses necessary for the implementation of the said Program. However, approval from the Commissioner of Budget is required under Section 55 of PD 1177 quoted as follows:Sec. 55. Authority to use Savings for Certain Purposes. Savings in the appropriations provided in the General Appropriations Act may be used for the settlement of the following obligations incurred during a current fiscal year or previous fiscal years as may be approved by the Commissioner in accordance with rules and procedures as may be approved by the President;In this connection, the requirements to be submitted to lift the suspensions for payment made to officials and employees of PDDCP representing their cash awards are reiterated.[3]
e. Cash awards to deserving officials and employees in accordance with civil service law;
It is represented that one reason cited by the COA Resident Auditor for the disallowance of expenses incurred by that Agency in granting the incentive award is the non-approval of the PDDCP-IAS by the Civil Service Commission.Petitioner then sent a letter, dated December 23, 1991, to Secretary Carague reiterating her earlier request for authority to pay the incentive awards in question. Again, it appears that the DBM did not respond.It may be mentioned that Section 35 of EO # 292 states that:In this connection, the Civil Service Commission, in its Resolution No. 91-1631 dated December 27, 1991 issued the Omnibus Rules Implementing Book V of EO # 292 and Other Pertinent Civil Service Law, which provide among others, Rule X or the rules and regulations implementing the Employee Suggestions and Incentive Awards System (ESIAS). Section 1 thereof specifically provides that:
“There shall be established a government-wide employee suggestions and incentive award system which shall be administered under such rules, regulations, and standards as may be promulgated by the Commission.
In accordance with rules, regulations, and standards promulgated by the Commission, the President or the head of each department or agency is authorized to incur whatever necessary expenses involved in the honorary recognition of subordinate officers . . .”“Section 1. Each department or agency of government, whether national, . . ., shall establish its Department or Agency Employee Suggestions and Incentives Award System in accordance with these Rules and shall submit the same to the Commission for approval. (underscoring supplied)In view thereof, and as its appears that the adoption and implementation of the PDDCP-IAS was in 1990, the Commission opines that the action of that Office in implementing the PDDCP Award System and all the expenses incurred in connection therein is in order.
It is understood however that starting February 14, 1992, that Office cannot adopt and implement the same System unless revised in accordance with Rule X of the Omnibus Rules Implementing EO # 292.[4]
Under the principle of fiscal responsibility resting with the head of the agency, appellant Minerva P. Franco, being the Executive Director of PDDCP, is primarily responsible for all government funds and property pertaining to her agency. It follows, therefore, that it is one of her duties to ensure that the requirements of transactions suspended or disallowed in audit are complied with. In the instant case, however, there was failure on her part to comply with all the requirements needed in order to make the questioned disbursement proper and valid. It must be emphasized that the disallowance in the amount of P379,200.00 representing payment of loyalty award was based on the absence of two (2) requirements, to wit: (1) want of authority from the DBM to use the agency’s savings from Personal Services to pay the loyalty award and (2) approval from the CSC to adopt the guidelines for granting the awards. Only the second requirement was complied with and records do not show that proper authorization from the DBM has been secured by the PDDCP.We find the petition to be meritorious. There is no question that prior authority from the DBM is needed for the use of savings for the payment of incentive awards. Section 49 of Book VI of Executive Order No. 292, otherwise known as the Administrative Code of 1987, provides:
Accordingly, in the absence of the required authorization from DBM to use the savings of the Personal Services of the agency to pay its loyalty cash awards, this Commission finds no justification to lift the subject disallowance. In view thereof, it is regretted that the herein appeal has to be, as it is hereby, denied.[5]
Hence, this petition. Petitioner contends:
1. The COA committed grave abuse of discretion in suspending the implementation of the loyalty award to the amount of P379,200.00 as provided in a post-audit.
2. The COA committed grave abuse of discretion in suspending only the implementation of the loyalty award, without any comment or action on the implementation of Recognition/Performance Award.
3. The COA committed grave abuse of discretion in suspending to implementation of the loyalty awards due to the inaction of the DBM.[6]
Authority to Use Savings for Certain Purposes - Savings in the appropriations provided in the General Appropriations Act may be used for the settlement of the following obligations incurred during a current fiscal year or previous fiscal years as may be approved by the Secretary in accordance with rules and procedures as may be approved by the President:Thus, State Auditor de la Cruz properly disallowed the disbursement of the amount of P379,200.00 for the payment of loyalty awards because of the absence of authority from the DBM. Why she allowed payment of P140,900.00 for performance awards does not appear in the record.
. . . .
(5) Cash awards to deserving officials and employees in accordance with civil service law.