THE Supreme Court has disallowed the use of the retained income of the Securities and Exchange Commission (SEC) to pay for the health care insurance premiums of its personnel.
This was the ruling of the Supreme Court en banc when it partly granted the petition for certiorari filed by the SEC challenging the Commission on Audit (CoA) decision to disallow the payment of its workers’ insurance premiums amounting to P13.775 million.
In 2010 and 2011, the SEC issued resolutions appropriating funds sourced from its retained earnings to cover the cost of health care insurance benefits for its officials and employees.
The funds were subsequently disbursed to the SEC Employees Association Inc., which, on behalf of the SEC personnel, applied the same as payment for health care insurance premiums paid to Medicard Philippines Inc. (Medicard), a private health maintenance organization.
The CoA said the fund’s utilization was improper because the SEC’s retained income should be used to augment the agency’s maintenance and other operating expenses (MOOE), as well as its capital outlay requirements.
“Personal services,” the Supreme Court said, are an expense category separate and distinct from MOOE and capital outlays.
