PNoy directs Oban to Strengthen Military Financial Management

AFP LogoImage via WikipediaA March 10, 2011 press release by the Department of Budget and Management

President Benigno S. Aquino III has directed Armed Forces of the Philippines (AFP) Chief of Staff Lt. General Eduardo Oban, Jr. to coordinate closely with the Department of Budget and Management (DBM) and the Department of National Defense (DND) in strengthening financial management systems in the military establishment.

The President issued a Memorandum directing Oban to submit a report within two months to detail the financial management reforms that he intends to introduce during his tenure; and thereafter, to submit progress reports on these reforms every six months.


“The current issue on the alleged anomalous use of AFP funds provides an opportunity to effect immediate remedial measures to strengthen financial management within the AFP,” the President has said in his Memorandum to the newly-installed AFP Chief-of Staff.

Budget and Management Secretary Florencio B. Abad said the DBM is ready to extend its full support to the new military leadership in implementing reforms to strengthen internal controls and pursue public financial management reform in the AFP.

“I believe the AFP is now more determined to march along the daang matuwid. I look forward to working closely with Lt. Gen. Oban especially in his first two months in office,” he said.

“I will hold onto his pledge to strengthen procurement processes, ensure accountability of resource managers, establish ample safeguards in the use of government funds and prosecute wrongdoers,” he said.

In his Memorandum, President Aquino directed Oban to work with Abad and Defense Secretary Voltaire T. Gazmin in addressing lapses in the AFP’s current financial management set-up and internal controls, specifically in:

Strengthening financial controls and accountability structures within and among the General Headquarters and the AFP’s major services to address the issue of ‘conversion;’
Complying with budgeting, accounting and auditing rules and regulations, as well as spending procedures and allocation, in order to minimize discretion;
Disclosing the military’s roster and in properly determining the actual financial requirements for soldiers’ compensation; and
Funding allocation among military bases, programs and key budgetary units, the competitive procurement of ammunition and other materials, and the adoption of performance baselines for programs.

Abad to Oban: “Be loyal to standards of daylight”

The President’s Memorandum also instructed the newly installed AFP Chief of Staff to ensure that transparency and accountability provisions of the 2011 General Appropriations Act are implemented in the AFP. Unless there are legitimate national security concerns, the status of procurements and other financial operations should be posted on the AFP official websites.

“This is the first thing I wish to tell Lt. Gen. when we meet: let us betray the dark ways of the past and be loyal to the standards of Daylight. Transparency, accountability and inclusiveness—against secrecy, connivance and exclusivity—will ensure our success,” the reform advocate said.

Abad said the Aquino administration intends to ensure that men and women in the uniform receive their needed operational support that they operate within the bounds of law.

“We do not wish to tighten financial controls in the military just to make life hard for our soldiers. On the contrary, we do this because we want to energize our men-and-women in uniform,” he stressed.

President Aquino has appointed Lt. Gen. Oban as the 42nd AFP Chief of Staff during the graduation rites of the Philippine Military Academy on March 6. Prior to his appointment, Oban was the AFP’s Deputy Chief of Staff responsible for the administration and supervision of the joint coordinating, technical and special staffs of the military headquarters.