Duque, ex-DBM officer maintain no irregularity in transfer of ₱42-B COVID-19 fund

Published August 25, 2021, 9:56 PM

by Vanne Elaine Terrazola

Department of Health (DOH) Secretary Francisco Duque III and former Department of Budget and Management Procurement Service (DBM-PS) head Christopher Lloyd Lao on Wednesday, August 25, maintained that the transfer of some P42 billion of pandemic response funds flagged by state auditors was above board and in accordance with existing regulations.

Department of Health Secretary Francisco Duque III (PCOO)

At the continuation of the Senate inquiry on the Commission of Audit’s (COA) report on the DOH’s use of COVID-19 funds, Senate Minority Leader Franklin Drilon questioned the two officials on the absence of a memorandum of agreement (MOA) between the DOH and the DBM-PS on the transfer of the multi-billion peso allotment for the purchase of PPEs, medical supplies, and hospital equipment.

Drilon said that for such a hefty amount, Duque should have thought of inking a MOA with the DBM-PS to ensure that the funds would be spent efficiently.

“Prudence would have dictated that when you transfer P42 billion to another agency…you should have signed a memorandum of agreement. Isn’t that a prudent thing to do for a Secretary? P42 billion is no small money,” Drilon told the DOH secretary.

But Duque said he saw no need for a MOA, citing a Government Procurement Policy Board (GPPB) resolution which authorized agencies to immediately procure items considered as “common use supply and equipment (CSE).”

Lao, whose name cropped up due to the supposed “overpricing” of face shields and face mask purchased by the DOH, echoed Duque.

“There is no need for a memorandum of agreement if the items that are being procured to PS-DBM are considered common use supplies. These items were already declared as common supplies,” he responded.

“Because if there is no declaration that these items are common supplies, then you cannot buy it directly from us until there is a memorandum of agreement,” Lao pointed out.

But Drilon, the Senate’s chief fiscalizer, said the move was in contrast with the Government Procurement Reform Act (Republic Act No. 9184), with its implementing rules and regulations (IRR) stating that procuring agencies may outsource thru the execution of a MOA.

Drilon also noted that the face shields were supposedly not in the inventory of the DBM-PS on the DOH’s procurement of CSE. This was likewise flagged by Senate President Vicente Sotto III and Senator Panfilo Lacson.

“So with or without MOA, with or without GPPB resolution to that effect, PS-DBM was not authorized at the time to procure face shields,” Lacson said.

Aside from the face shields, the purchase of extraction machines and mechanical ventilators amounting to P1.55 billion was also not listed, Drilon said.

“They are. Most of them are in the inventory in the PS-DBM,” Duque maintained.

Drilon, quoting a former DOH secretary he did not name, added that he believes that the department could “very well” handle the P42-billion procurement thru its Bids and Awards Committee (BAC).

Later, Duque conceded that after the COA’s findings, “we have agreed that with your guidance, we can still, actually come up with a memorandum of agreement.” “This is one of the deficiencies that was reported, and we are given 60 days…to correct those deficiencies,” he told the Senate panel.

The DOH said that out of its transfers to the DBM-PS, P39 billion worth of commodities have been delivered.