MANILA — State auditors have flagged the Commission on Higher Education (CHED) for failing to use P6.61 billion in available funds in 2025, a lapse that delayed scholarship assistance and other education programs, according to the Commission on Audit (CoA), the constitutional body that reviews how government agencies spend public funds.

In its 2025 audit report, CoA found that CHED committed P44.97 billion, or 87.18%, of its P51.59 billion in budget allotments, but released only P28.54 billion in payments. The agency ended the year carrying P16.43 billion in unpaid obligations alongside the P6.61 billion that had never been committed to any program or project.

“CHED’s inefficient fund utilization marked by low disbursement performance in CHED-National Capital Region, lapse of continuing appropriations in CHED-Central Office, and an unobligated balance of P6.61 billion at yearend resulted in delays in program implementation and reversion of substantial public funds to the National Treasury,” state auditors said.

The uncommitted balance consisted of P3.68 billion from 2025 appropriations and P2.93 billion carried over from previous years. Under the national budget process, amounts that revert to the National Treasury are no longer available to the agency unless they are re-appropriated in a later spending law.

Auditors also flagged deficiencies in the implementation of the Tertiary Education Subsidy program under Republic Act No. 10931 — the Universal Access to Quality Tertiary Education Act of 2017, the country’s centerpiece law for free tertiary education and student subsidies — which involved P30.01 billion in transactions. According to CoA, weaknesses in program administration across regional offices contributed to delays in financial assistance, unsettled fund transfers and inadequate accountability. It urgedED’s central and regional offices to settle outstanding fund transfers, enforce documentation requirements and improve monitoring.

The audit likewise found that lapses in the Free Higher Education (FHE) program, another pillar of RA 10931 that covers tuition in state and local universities and colleges, led to a P17.22-million overpayment to Kolehiyo ng Lungsod ng Lipa.

“Lapses in the implementation of the Free Higher Education program were noted, thereby resulting in an overpayment of P17.22 million to Kolehiyo ng Lungsod ng Lipa and undermining the integrity and reliability of the FHE disbursements,” state auditors said.

The Tulong Dunong Program, a student grant initiative involving P1.28 billion in transactions, was also cited for delayed assistance, inaccurate beneficiary records and weak financial controls. CHED’s National Capital Region office carried P211.34 million in unpaid obligations under that program.

Other programs flagged included the CHED Merit Scholarship Program, involving P716.19 million; the Agricultural Competitiveness Enhancement Fund Grants-In-Aid for Higher Education Program, P451.74 million; and the Scholarships for Staff and Instructors’ Knowledge Advancement Program, P134.97 million. Auditors additionally identified deficiencies involving P90.71 million under the Coconut Scholarship Program, P19.1 million under the Student Monetary Assistance for Recovery and Transition Program and P5.88 million in unsettled transfers under the K to 12 Graduate Scholarship Program.

Separately, unresolved audit suspensions, disallowances and charges against CHED totaled P3.77 billion as of Dec. 31, 2025. In CoA practice, suspensions are transactions held pending submission of required documents, while disallowances call for the refund of expenditures found irregular or unsupported. These included P3.03 billion in suspended transactions requiring further documentation, P735.11 million in disallowed expenditures and P31,301 in audit charges.

CoA also reported that 115 of its 290 previous audit recommendations remained unimplemented.

Despite the deficiencies, state auditors issued an unmodified opinion on CHED’s 2025 consolidated financial statements, indicating that the accounts fairly presented the agency’s financial position.

CHED management agreed with the recommendations and committed to improving budget planning, strengthening internal controls and recovering unsettled funds. CoA tracks the implementation of its recommendations in subsequent audits, making CHED’s follow-through on those commitments — and on the backlog of 115 unresolved items from earlier reports — a point to watch in next year’s review. — Pexcel John Bacon, BusinessWorld