Ex-DBM exec admits: Negligence a 'possibility' in purchase of overpriced face masks, face shields

Former Budget Undersecretary Christopher Lao conceded on Friday, August 27, that there might be negligence in the government's purchase of allegedly overpriced face masks and face shields at the start of the COVID-19 outbreak last year.

Former Budget Undersecretary Lloyd Christopher Lao attends the Senate Blue Ribbon Committee hearing on August 25, 2021 into the reported deficiencies of the DOH in spending COVID-19 funds. (Senate of the Philippines/YouTube)

Lao made the admission when again questioned on the transfer of the P42.2 billion to the Department of Budget and Management's Procurement Service (DBM-PS) at the resumption of the Senate Blue Ribbon Committee's inquiry on the reported deficiencies of the Department of Health (DOH) in handling its COVID-19 response funds.

The former undersecretary headed that DBM-PS when DOH tapped the agency for the procurement of COVID-19 response supplies and equipment, including face masks and face shields worth over P95 million.

"When you say there might be negligence, or we were not able to exhaustively look for the cheapest supplier there might be a possibility given the scenario -- we lack time, we lack the resources, the connection during the time -- that might be a possibility," Lao said in response to queries of Senator Francis Pangilinan.

Pangilinan had maintained the prices of the face masks and face shields procured by the DBM-PS were exorbitant compared to those purchased by the Philippine Red Cross (PRC).

State auditors said the face masks cost as high as P27.72 each, while the face shields were priced at P120 each.

On the other hand, the PRC was able to buy face masks and shield at P5 per piece and P15 per piece, according to its chairman Senator Richard Gordon.

"I cannot explain that. I think the only thing that I can check is, maybe Red Cross has very good network. They have international ties with International Red Cross, especially in China, so they have faster communication," Lao initially said.

He added that at the time, the procurements of the DBM-PS were the cheapest, with offers supposedly amounting to "roughly around P40" for face masks, and "around P400, P350, and lowest was P120" for face shields.

"I bellieve the difference is that the Red Cross has wider access, during the time, compared to us," Lao surmised.

Not satisfied with Lao's explanations, Pangilinan said: "It is also possible, Mr. Lao, that you are negligent. It is possible. I'm not saying you were, but the possibility that you were negligent that you purchased -- that Red Cross was more circumspect and was able to purchase it at P5 while government -- because I don't know, perhaps, maybe because of negligence, bought it five times more expensive."

"Maybe if there was a more diligent search, maybe if there was a more diligent process, then we could have brought down the price of a P27 face mask, and a P120 face shield," the senator added.

During Wednesday's Senate hearing, Lao, as well as Health Secretary Francisco Duque III, maintained that there were no irregularities in the transfer of funds between their agencies.