Redesign

FIRST PERSON

- ALEX MAGNO

For good reason, intense controversy broke out over the transfer of unused funds from PhilHealth to the National Treasury. The controversy spurred petitions before the Supreme Court. Oral arguments have been heard by the magistrates and the issue may be resolved either way.

Much of the funds transferred were used for government programs related to health. This includes paying out the much-delayed remuneration for the health workers pressed into the service during the lockdowns.

From the point of view of government, the transfer of unused funds made complete sense. Unused funds benefit no one. It carries the moral hazard of encouraging public agencies to fail in fully utilizing its funds to render service, preferring to sit on a pile of fixed income investments.

Dr. Kenneth Hartigan-Go of the Ateneo Policy Center articulates the core issue in this debate plainly. The real problem is not the reallocation of unused funds. It is the inability of PhilHealth to use the money it has.

This is not really a debate over the morality of transferring unused money. It is a debate over whether the public good is better served by reallocating funds from an institution that failed to fulfill its mandate or by letting the unused funds lie idle.

I have difficulty imagining that keeping unused funds produces any public good. It only makes a public agency behave like a mediocre financial investor. PhilHealth, after all, is not configured to be an investment house.