MANILA, November 7, 2004 (STAR) By Delon Porcalla - The government is losing an estimated P200 billion to corruption every year, Ombudsman Simeon Marcelo told congressmen last Thursday.

In a hearing of the House of Representatives’ committee on appropriations, Marcelo blamed the loss on corrupt personnel in the Bureau of Internal Revenue (BIR) and Bureau of Customs, the government’s two main sources of revenue.

"The greatest loss due to corruption happens at the revenue generation agencies," Marcelo stated in a brief he submitted to the House panel for the hearing on the proposed P480-million budget for Marcelo’s agency.

He also anchored his personal assessment on a United Nations estimate that P100 billion remained unremitted to government coffers because of corrupt officials in the customs and internal revenue bureaus.

Camarines Sur Rep. Rolando Andaya Jr., committee chairman, said Marcelo told the budget hearing "at least P105 billion is lost yearly due to the deliberate failure to collect taxes properly."

"This means at least P200 billion, half on expenditure activities and the other half on the revenue front, is lost to grafters every year, an amount that is twice the annual budget of the Department of Education," Andaya said.

Marcelo pushed for additional funding to hire 150 more prosecutors and 500 more field investigators so his agency can keep an eye on the government’s 1.5 million workforce.

"Officials of the BIR and the Customs bureau are the priority targets of our lifestyle check project. We need more personnel to handle our just-expanded investigation on the alleged massive corruption in the military," Marcelo said, referring to suspended Maj. Gen. Carlos Garcia, who is facing charges of ill-gotten wealth.

Andaya conceded that Marcelo’s agency has "one of the smallest investigation crew in the world" with only 87 field investigators but said the Office of the Ombudsman’s budget for next year could only be stretched to P535 million.

"The government does not have the money to hire the equivalent of two battalions of investigators and 120 lawyers for the Ombudsman," he said, citing the government’s serious fiscal crunch which has been largely blamed on corruption.

Various international agencies have expressed concern about massive corruption in the Philippines, which analysts say has discouraged foreign investors.

In January last year, the Arroyo administration launched an anti-corruption campaign that included "lifestyle checks" on government officials.

Independent estimates suggest at least a fifth of the government budget is lost through graft.

One local watchdog group, Procurement Watch Inc., estimated that the Philippines loses P21 billion a year to corruption in the procurement of government goods and services alone.

Because of the pervasiveness of corruption in government, the Makati Business Club (MBC) — one of the country’s most influential group — said in June it was planning to put up a fund to fight corruption because businessmen have reached their "breaking point."

MBC executive director Guillermo Luz said many businessmen were willing to chip in three percent of their income to put up the fund "because they feel they are going to save so much because the cost of corruption on their businesses is over 20 percent."

Reported by: Sol Jose Vanzi

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