COA findings agree with House accusations against DBM procurements

Published January 17, 2019, 5:42 PM

by Dhel Nazario, Jeffrey G. Damicog, and Rey G. Panaligan

By Ben Rosario

The Commission on Audit has backed the leadership of the House of Representatives in questioning the Department of Budget Management’s procurement processes, including the bidding and awarding of big-ticket consultancy contracts one of which has cost government P14.3 billion.

MB FILE—Commission on Audit.

Auditors chided the DBM-Procurement Service for failing to put in place feedback mechanism on the quality of goods and services and procedures to manage complaints of clients.

Further, COA, in its 2017 annual audit report for the agency, noted that copies of some procurement contracts have not been submitted for audit. It also questioned the PS-Bids and Awards Committee for failing to prepare and post procurement monitoring report in the government website.

The audit agency had asked the PS management to impose disciplinary action against concerned members of the BAC and other agency officials for failing to observe the criteria set forth under the Government Procurement Act in connection with the purchase of 189 units of Patrol Jeeps for the Philippine National Police.

House Majority Leader Rolando Andaya Jr. recently raised the same issues against the DBM-PS after it was discovered that contrary to claims made by Budget Secretary Benjamin Diokno, the agency had actually been involved in the procurement of goods and services for other government agencies to the tune of P198 billion in 2018.

Andaya shared the auditors’ observation that the DBM-PS lacked the expertise to conduct public biddings for big-funded projects. He cited the contracts for P168.2 billion worth of goods and services for Department of Transportation‘s foreign-funded projects.

According to Andaya documents in possession of House Rules Committee show that for 2018 alone, the DBM-Procurement Service was responsible for bidding more than P37 billion in government contracts for consultants.

The biggest contract, worth P14.3 billion, is for Project Management Consultancy for the PNR South Long Haul Project of the North-South Railway Project. It was awarded on 31 October 2018.

The same documents also indicated that P11.7 billion was bidded for General Consultancy for Metro Manila Subway Project Phase 1 (Valenzuela-Paranaque). It was awarded on 18 October 2018.

Andaya disclosed that another General Consultancy worth P11.7 billion was bidded for the Metro Manila Subway Project Phase 1 awarded on 31 October 2018.

“The P37-billion contracts for consultants were part of the P168-billion fund that the DOTr obligated to the DBM-Procurement Service for bidding purposes,” he said.

DBM-PS Executive Director Bingle Gutierrez furnished the rules panel with copies of the said documents during the public hearing on the reported involvement of Diokno in budget insertion irregularities.

Andaya released the information in the documents as he chided Diokno for insisting that the DBM had never dabbled into procurement and bidding of infrastructure contracts of other government agencies.

The House official said the procurement activities of the DBM-PS belied Diokno’s claim.

Andaya had linked Diokno in the bidding and awarding of some P10 billion flood management and control contracts in Sorsogon and Catanduanes.

“This is quite alarming,” said Andaya.

In its report, COA spelled out the mandate of the DBM-PS: “The issuance of Administrative Order No. 17 dated 28 July 2011 reiterated to all government agencies that their procurement of common use supplies shall be done through PS and that the PhilGEPS shall be used in all their procurement activities, including publication of all their bid opportunities and posting of all their awards and contracts, in accordance with Republic Act No. 9184.”

The COA, in the same report, noted the lack of transparency in the procurement activities of DBM-PS.