Audit at Defence: materials handed over without valid receipts

What it is

The Ministry of National Defence's Social Housing Programme began in 2011 as an "Adequate Housing" pilot and is run by the General Directorate of Social Services. It hands out a non-salary basket of building materials to ministry staff — junior K-scale and civilian personnel — living in substandard housing, so they can build for themselves. According to the audit report, the basket is estimated at up to $240,000 pesos and exceptionally up to $430,000, for a basic 16 m² module with a bathroom and one room. Between January 2023 and December 2025, 186 subsidies were granted. Materials are bought through the Centralised Defence Procurement Unit (U.C.AA.D.) via public and abbreviated tenders, price competitions and direct purchases: $9,436,052 committed in 2023, $5,547,934 in 2024 and $8,987,247 in 2025.

What is questioned

The National Internal Audit Office, in a report dated April 2026 covering January 2024 to December 2025, reported four findings. In the first it found notes from the director certifying that funds went to the programme "placing on record the non-existence of the corresponding delivery notes", delivery notes without the signature of the person receiving the materials, and documentation that "does not constitute a valid delivery note under the applicable rules". Among the risks it listed, verbatim, "Payment for materials not delivered or not used in the works" and "Collusion", both classified as fraud. In the second finding it noted the absence of legal reports between 2024 and 2025 on the beneficiary's legal relationship to the property — a mandatory requirement — resolutions that do not always include the supplier detail or the total benefit amount, the lack of a formalised maximum amount, and a 2024 case in which the materials-delivery resolution was issued five months after the beneficiary had left the Ministry and was carried out anyway. Monitoring of works outside the metropolitan area, it adds, relies "mainly on phone calls and/or messages".

Why it matters to you

The programme distributes building materials to the Ministry's lowest-paid staff. The absence of valid delivery notes does not prove materials are missing, but it means the State cannot demonstrate that what it paid for reached the intended recipient. And if it does not, the one who loses out is the soldier waiting for a bathroom and a room.

Where it stands