Former Department of Health secretary Francisco Duque III confirmed in a hearing yesterday in Congress that former president Rodrigo Duterte ordered him to transfer the department’s P47.6 billion fund for the Covid-19 pandemic to Procurement Service of the Department of Budget and Management (PS-DBM). PS-DBM was then led by Lloyd Christopher Lao, a native of Davao and known to be close to Duterte. Lao was a member of the Presidential Management Staff before Duterte appointed him to the PS-DBM.

Lao used part of the funds to award contracts to Pharmally Pharmaceutical Corporation to supply face masks, shields and other protective equipment. This was despite the company being unqualified for such huge contracts. The company is connected to Michael Yang, who served as Duterte’s “economic adviser” for a time. This anomaly is one of the biggest corruption cases during the pandemic.

Only last May 6, the Ombudsman declared the transfer of such funds “illegal”, and recommended that Duque and Lao be charged. The Ombudsman said Duque and Lao acted “in bad faith” and exhibited “gross, inexcusable negligence” when they transferred the funds from March to December 2020.

Although he transferred the funds, Duque excused himself by saying he did so in accordance with Duterte’s verbal order and upon the recommendation of the Inter-Agency Task Force and the National Task Force against COVID-19. The fund is part of the $2.21 billion (₱129 billion at the exchange rate of $1=₱55) the Duterte government incurred in debt under the guise of responding to the Covid-19 pandemic.