Corruption scandals amid COVID-19 in 2021

By Leah Perez, Jeraldine Pascual

The consistent lack of attention has caused the

government to sideline health needs, turning more

to ambitious plans of development based on infrastructure. Corruption may be a long standing problem, but its conduct during the pandemic when public funds were diverted from the purpose of protecting lives revealed it at its worst.

THE COVID-19 virus was not the only infection to threaten the country in 2021. While the corona virus disrupted every aspect of public life, causing loss of life and livelihood, another contagion, clearly not a new one, showed up again as a lingering ailment in government and politics. An old disease, it had become endemic in the political sphere, revealing itself in different aspects of public affairs. 

Although so many dedicated Filipinos were working to do their part to protect and save lives, there were those severely infected by the virus of greed, using the very systems designed for public health for their personal gain. 

In 2021, the news showed how graft exacerbated the already deadly impact of the pandemic. 

PhilHealth mess 

The health sector has a history of being mired in corruption. 

The Philippine Health Insurance Corporation (PhilHealth) which was set up in 1995 has proven beneficial for so many Filipinos, relying on discounts to lower the costs of hospitalization and services such as radiotherapy, surgery, and hemodialysis. 

In 2020, with the COVID pandemic already affecting the country, a resigned official blew the whistle and alleged widespread corruption on several levels: the procurement of overpriced IT equipment; the questionable release of billions of funds under the corporation’s Interim Reimbursement Mechanism (IRM); and the alleged manipulation of Philhealth’s financial records. 

PHP15 billion was supposedly pocketed by the so-called Philhealth “mafia,” most of them executive officials of the corporation. Health Secretary Francisco Duque III as Chair of the Board was named the “godfather” of the group.

The Senate Committee of the Whole immediately scheduled hearings on the charges. Following the sessions, the media gave the issue the prominence it deserved.

When President Duterte defended Duque, confirming his confidence in his Department of Health (DOH) Secretary, journalists did not refer to Duterte’s oft-repeated stand against corruption. Duterte ordered a reshuffle of officials and the dismissal of some, but no one was charged criminally, despite the Senate’s recommendation.

DOH and tears

Fast forward to 2021, news picked up on the release of the Commission on Audit’s (COA) annual report, which showed findings on the poor management of pandemic funds by the DOH. “Various deficiencies involving some PHP67,323,186,570.57 worth of public funds and intended for national efforts of combating the unprecedented scale of the COVID-19 crisis were noted,” the COA report said.

Duterte was unhappy with the report, spewing expletives against COA and downplaying calls for Duque to resign. Duque, instead of giving a clear explanation, complained: “Winarak na ninyo kami eh. Winarak na ninyo ang dangal ng DOH. Winarak ninyo ang lahat ng mgakasama ko dito.” (You destroyed us. You destroyed the honor of DOH. You destroyed all my colleagues here.)

Media tracked developments in Congress’ hearings, where lawmakers picked up on COA’s findings, including non-payment of benefits to healthcare workers, overpriced ambulance equipment, cellphones, and dash cameras. 

Pharmally controversy

As though the PhilHealth issue and COA reports were not enough, a bigger scandal would further expose the failure of Duterte’s promise to wipe out corruption, or to question the sincerity of his frequently expressed hatred of corruption. 

From the anomalies in fund management indicated in the COA report, the Senate’s investigation branched into pandemic contracts bagged by Pharmally Pharmaceuticals Inc., a little-known company with no track record or financial capacity. Government had paid PHP12 billion to Pharmally to deliver COVID supplies such as personal protective equipment (PPEs) and face shields, most of them examined and pronounced of dubious quality as well as overpriced. 

News followed proceedings in the Senate. In the first three months of 2021, Pharmally secured deals worth PHP8.5billion, around 13 times more than the firm’s paid-up capital. The Senate also found that of the six companies that supplied face masks, Pharmally had the highest unit price.

CMFR cheered Rappler  for describing in detail how EMS Components Assembly, along with five other Filipino companies got  “ignored” and “cheated” by the government despite offering  PPEs at lower prices and providing jobs for Filipinos. also published an in-depth report on the billions in profits that Pharmally made for importing these products. 

Rappler also looked through Securities and Exchange Commission (SEC) documents, revealing the links connecting Pharmally and Michael Yang, a Chinese businessman and former economic adviser of President Duterte. Other government officials linked to the scandal were later revealed to have been working for Senator Christopher “Bong” Go when he was still an aide to Duterte.

Hearings in the House indicated that the chamber was more forgiving of Pharmally and those involved, but the media did not make much of the dis-connect between the two legislative houses. 

News reports noted the different reactions of President Duterte, who at times kept his silence on the issues raised; and at other times attempted to divert and prevent the investigations. Duterte ordered the military and police not to arrest anyone and to ignore the Senate’s subpoenas. He also ordered Cabinet officials and government witnesses to ignore the probes. 

More than a whiff 

Duterte’s presidential campaign ran on an anti-crime and corruption platform. Duterte dared the public to kill him if he failed to bring down crime and corruption in the country during the first six months of his term. He was recorded as saying,“One whiff of corruption, you’re out.” 

It is becoming increasingly clear that all that was big empty talk. As his administration has been hounded by scandals and allegations of graft and corruption, Duterte admitted himself that eradicating corruption was “impossible” and was “endemic in government.” 

Corruption may be a long standing problem, but its conduct during the pandemic when public funds were diverted from the purpose of protecting lives revealed it at its worst.

The media should review the record and establish the pattern of how Duterte has allowed continuing corruption by defending those alleged to be engaged, or even the failure of his agencies to file the necessary charges in court.