COA wants delayed P20.7B contracts for NIA projects rescinded

Published August 12, 2019, 6:52 PM

by CJ Juntereal

By Ben Rosario

The Commission on Audit (COA) has sought the termination of contracts and forfeiture of contractor’s performance bonds for majority of 299 irrigation projects of the National Irrigation Administration (NIA) with a total budget of P20.704 billion.


Included in the 299 contracts are 72 on-going contracts worth P13.993 billion but this early have incurred negative slippages ranging from .11 percent to 87.84 percent.  The projects were for irrigation systems in Regions V, IX and Central Office.

COA made the recommendation as state auditors called for the immediate imposition of liquidated damages on contractors assigned to implement 44 NIA projects worth P12.145 billion that may still be continued but have incurred negative slippages “without valid justification.”

COA revealed in the 2018 NIA Annual Audit Report that its auditors have been prevented from conducting audit examination of 526 perfected infrastructure contracts due to the late submission of copies of the perfected contracts.

On the other hand, 115 contracts worth P1.190 billion that were awarded  by the three regional offices were submitted for audit only after the lapse of one year, “precluding the Audit Teams from conducting timely review and communicating audit results.”

State auditors slammed NIA for awarding 106 contracts amounting to P4.345 billion to bidders that submitted the lowest calculated bid for each project but were unable to pass eligibility requirements under Republic Act NO. 9184 (Government Procurement Law).

Aside from failing to submit complete documentary and eligibility requirements, winning bidders submitted deficient legal, technical and financial eligibility documents.

Bidders who won two or more contracts submitted similar sets of personnel and equipment to work simultaneously for separate projects.

“Likewise, contract was awarded without first securing authorities/permits to enter or proofs of acquisition of ROW (right of way),” COA said.

The audit agency added: “All are contrary to the Revised IRR of RA No. 9184 and Government Procurement of Infrastructure Projects.”

Long delay
The long delay in the completion of 299 irrigation projects with a total contract cost of P20.704 billion was blamed on the lack of proper planning and implementation of the projects.

The said projects were delayed by up to 2,283 calendar days “owing to the unsatisfactory performance of contractors, among others,” COA disclosed.

Audit examiners noted that NIA did not impose liquidated damages for 44 contracts costing P12.245 billion, saying that the penalties should be imposed unless there are acceptable justifiable reason for the delayed construction.
The NIA Legal Department and Internal Audit Services were asked to conduct an investigation into the non-imposition of penalties and identify the persons responsible for proper disciplinary sanctions.

Responding to the audit findings, NIA management vowed to institute measures that would address the delay in the construction of irrigation projects.

However, NIA officials said lack of water, uncooperative weather condition and quarrying are among the reasons cited for the delay.

“ON the other hand, the performance bonds of three terminated contracts have been forfeited by NIA,” NIA executives explained.

NIA management, COA said, had agreed to change orders and extension of contract time to contractors awarded 42 projects with a total cost of P544.184 million.

According to COA the approval of the change orders and extension of contract time came without NIA conducting a comprehensive evaluation and without incomplete documentation, thus, “resulting in wastage of government resources.”