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CoA orders Napolcom to end contract with 2 gas stations

Manila, Philippines – The Commission on Audit (CoA) has directed the National Police Commission to end its contract with gasoline stations that have been charging “evaporation fees” for petroleum products sold to the agency.

Describing the deal as “irregular and disadvantageous to the government”, CoA said Napolcom paid over P845,000 to two gasoline stations that have been receiving advance payments for gasoline and diesel products that have yet to be delivered.

The audit agency also chided the commission for entering into gasoline supply deals with stations located far from the agency’s headquarters on Gil Puyat Avenue, Makati City.

One station is located in Paranaque City while another in Manila.

In its 2010 annual audit report for Napolcom, CoA stated that it is both unfair and highly anomalous for Napolcom to pay for evaporation fees when the contract with the gasoline stations do not call for the storage or reservation of petroleum products for the commission.

Citing the Administrative Code, CoA auditors said Napolcom is enjoined to always safeguard government resources against wastage, or illegal and improper disposition.

The Napolcom is also enjoined by law to ensure efficiency, economy and effectiveness of such resources.

CoA records show that Napolcom paid evaporation fee of P591,317.47 to Romaanio Trading and Car Care services for petroleum product supply covering August 2008 to December 2010.

The Southway Petron Center, on the other hand, charged Napolcom with P253,714.70 in evaporation fees from August 2007 to July 2008.

“The present agreement is considered an advance deposit of money to the gasoline station where withdrawal of gasoline based on the amount is charged against the deposit, hence the purpose of charging the evaporation fee is considered irregular and disadvantageous to the government,” the CoA report said. (Ben R. Rosario)