MANILA, 8 January 2003 — About 250 million pesos belonging to Overseas Filipino Workers (OFWs) has been recovered by the Overseas Workers Welfare Administration (OWWA), Labor Secretary Patricia Sto. Tomas announced.

The recovered funds were invested the Smokey Mountain Reclamation and Development Project (SMRDP) and were guaranteed by the Housing Insurance Guarantee Corporation (HGC).

OWWA collects $25 from all OFWs.

Sto. Tomas said the amount represented the first tranche of millions in OFW funds initially invested in SMRDP certificates without proper board approval, and its subsequent interest.

The initial investment was P459 million for SMRDP certificates worth P500 million. This amount was used to develop Smokey Mountain through R-II Builders.

The original investment matured in 1989 and had grown to P839 million and earned an additional P232.4 million in interests.

The SMRDP was a flagship program of former President Fidel Ramos which intended to eliminate the Smokey Mountain problem in Tondo. It also has a housing component and a reclamation area.

Aside from the P250 million already paid, HIGC promised to pay OWWA another P250 million in cash by the end of the month. The balance (roughly P1.07 billion) will be in the form of debenture bonds.

The original investment was roughly 45 percent of OWWA’s capital funds at that time.

However, a committee tasked to investigate investments of welfare funds discovered that aside from SMRDP certificates, there were other investments made without board approval, including P200 million in 1983 to Landoil Resources and Greater Manila Land Corporation (GMLC).

These other loans have not been repaid.

"This settlement is the fruit of Secretary Patricia Sto. Tomas’ efforts in protecting and promoting the OFW welfare fund," explained new OWWA Administrator Virgilio Angelo.

He added "this is a big victory for OWWA and its stakeholders, the OFWs. Now that the controversy is over, we can focus on the more important task of wise investment of the fund and better programs and services to our clients."

For one, he told Arab News he was planning to issue quarterly financial statements so that OWWA would become more transparent.

Angelo, a former investment banker, says that the investments of welfare funds authorized by OWWA’s former administrators were not prudent investment moves.

While technically under the supervision of the Department of Labor and Employment (DOLE), OWWA had been allowed to operate more or less as an independent entity over the years.

Little oversight was exercised and was seen in the fact that OWWA did not submit annual financial statements for approval by the DOLE.

OWWA had even relaxed spending guidelines over the years with the result that the agency’s expenses exceeded its annual collections.