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Bacolod City, PhilippinesWednesday, August 28, 2013
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SC affirms disallowances
vs. PSALM's incentives

The Supreme Court yesterday affirmed the ruling of the Commission on Audit that declared illegal the grant of incentives by the Power Sector Assets and Liabilities Management Corporation to its employees.

This as the SC en banc dismissed the petition of PSALM seeking to reverse and set aside the ruling of the COA favoring the Notice of Disallowance it issued against the PSALM.

The case stemmed from the grant by the PSALM of Corporate Performance-Based Incentive to its employees, the amount of which is equivalent to their five-and-a-half months' salary.

However, the grant of the said incentive was implemented without the required approval from the Office of the President which is provided for under Section 64 of the Electric Power Industry Reform Act.

Although the PSALM secured the approval of the OP in 2009 for the incentive they granted in 2008, the COA still issued the Notice of Disallowance especially so that the amount of the incentive was excessive.

The SC said no grave abuse of discretion was committed on the part of the COA because the approval secured by the PSALM in 2009 cannot still be considered as substantial compliance in the requirement as stated in the EPIRA.*PNA


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