G.R. No. 278582 - MA. GLADYS CRUZ-STA. RITA, LORNA T. DY, ALEXANDER P. JAPON, MARINA DEL ROSARIO, MONICA R. LEGASPI, MARCIANA B. GUINTO, AND NATIONAL POWER CORPORATION RECIPIENT-BENEFICIARIES, VS. COMMISSION ON AUDIT.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE , premises considered, the herein Appeal is DENIED . Accordingly, Notice of Disallowance (ND) No. NPC 15-008(14) dated July 21, 2015, covering the payment of Group Hospitalization and Life Insurance Premiums of PGEA-NPC members for the period April 1, 2014 to March 31, 2015 in the amount of [PHP] 34,047,188.03 is hereby AFFIRMED . [19] (Emphasis in the original) It was ruled that the payment of premiums for the members of GHLIP was a form of additional allowance and compensation which directly contravened COA Resolution No. 2005-001. [20] Ruling of the COA En Banc By its assailed Decision dated January 24, 2022, the COA En Banc denied the subsequent petition for review of Cruz-Sta. Rita et al. and affirmed the ruling of the COA Corporate Government Sector-Cluster 3, viz.: WHEREFORE, the Petition for Review of Ms. Gladys Cruz-Sta. Rita, Ms. Lorna T. Dy, Mr. Alexander P. Japon, Ms. Monica R. Legaspi, Ms. Marina Del Rosario and Ms. Marciana B. Guinto, all of the National Power Corporation (NPC), of Commission on Audit Corporate Government Sector-Cluster 3 Decision No. 2016-26 dated June 27, 2016 is hereby DENIED. Accordingly, Notice of Disallowance No. NPC 15-008(14) dated July 24, 2015, on the payment of premiums for the Group Hospitalization and Life Insurance Plan (GHLIP) of the National Power Corporation employees to the Power Generation Employees Association, for the period April 1, 2014 until March 31, 2015, in the amount of [PHP] 34,047,188.03 is AFFIRMED. The Audit Team Leader and the Supervising Auditor are directed to verify the participation of the members of the Board of NPC who issued Resolution No. 2013-25 series of 2013 on the payment of GHLIP; and the Chairperson and members of the Labor Management Consultative Committee (LMCC) who issued LMCC Resolution No. 2014-001 dated March 21, 2014 authorizing Power Generation Employees Association to enter into a Contract with Insular Life Assurance Company, and issue a Supplemental ND, if warranted. [21] (Emphasis in the original) Citing Section 12 of Republic Act No. 6758, [22] the COA treated the premium payments for GHLIP as illegal expenditures. It ruled that under the aforesaid provision, all allowances and compensation of government personnel are consolidated into the standardized salary of the employees. The procurement of GHLIP for the benefit of the PGEA-NPC members provides an additional compensation to employees that was not included in the exception from the general rule of integration. The authority to receive additional compensation, not integrated into the standardized salary rates, pertains only to those being received by incumbents as of July 1, 1989 and not to those hired afterwards. Here, it was not shown that the employees who received the GHLIP were incumbents as of July 1, 1989. [23] The COA further ruled that under COA Circular No. 2012-003 [24] dated October 29, 2012 premium payments for health insurance of government officials and employees without prior aut