Sunday, August 25, 2013

Pork barrel and competitive bidding: a palliative solution to a systemic problem

“The result of direct earmarking is pork, but it will no longer be officially called PDAF. No more funds will be disbursed through NGOs, eliminating kickbacks. And projects will have to go through competitive bidding, making them transparent.

The requirement for competitive bidding and the elimination of NGOs would prevent a repeat of the P10-billion pork barrel scam,” so says Department of Budget and Management (DBM) Secretary Butch Abad. (From: Not so fast, sir.

Before jumping into this conclusion, may I recommend that the good Secretary and PNoy first revisit Republic Act (RA) No. 9184, otherwise known as the “General Procurement Reform Act (GPRA).”

The law, as it is right now, is prone to abuse, and the Ombudsman can very well provide a report of complaints arising from RA 9184 violations. The wily legislators and the willing heads of concerned line agencies may simply re-focus and re-direct their attention to the bidding process and their pet Bids and Awards Committees (BACs).

Firstly, the composition of the bids and awards committee (BAC) itself may already be compromised as it would be the head of the agency (i.e., head of procuring entity) who chooses its members as well as appoints the technical working group and the secretariat, through a memorandum or office order, for a term of one (1) year. Moreover, the BAC choice of a winning supplier/contractor – based on a pass/fail test – or the use of alternative modes of procurement (e.g., negotiated, direct contracting) is merely recommendatory; it may be approved or disapproved by the head of the procuring entity. (Sec. 12 & Sec. 37)

Thus, while the heads of the agencies and the lawmakers appear passive and non-participants to the bidding process, they will call the final shot, eventually. There is the tendency then for the BAC members to do their bosses’ (whispered) bidding, (pun intended). An explosive mix of “utang na loob” (debt of gratitude) to the boss/es, fear of ostracism by fellow members, and, for some, the expectation or receipt of a “share,” would simply be overwhelming. The anti-graft laws be damned.  

Secondly, the procuring entity, through the BAC, can tweak or rig the terms of reference or certain requirements to eventually favor a particular supplier/contractor. RA 9184 says, “The Procuring Entity may require additional document requirements or specifications necessary to complete the information required for the bidders to prepare and submit their respective bids.” (Sec. 17) It may also subject the winning bidder to a post-qualification review, for its possible disqualification, assuming the “favored/chosen” bidder does not submit the lowest calculated bid (LCB).

Other concerns, such as the bidders’ falsification of bid documents and requirements, their collusion among each other and with public officers, splitting of contracts and the use of alternative methods of procurements to avoid public bidding, are just some other means to achieve the same end as discussed in the first issue.

With much respect and trepidation, may I suggest the following then:

PNoy must rethink and reconsider the role of the Commission on Audit (COA), from simply being an observer during bidding and conducting post-audit, to actually doing pre-audit. COA may take due notice of the approved budget for the contract (ABC), the duly Bureau of Internal Revenue (BIR)-stamped and updated income tax returns (ITRs) of the bidders, the prevailing cost of labor, supplies and/or materials, the availability of goods, among other things.

The manner by which the BAC is constituted must also be reviewed. Instead of being a mere ad hoc body, regular plantilla positions, with specific qualifications, may be created for its members, fairly immune to lawmakers and whoever sits as head of the procuring entity, but subject nonetheless to laws on public employees and officers. In this manner, potential conflict on issues of procurement with the functions of those who head the Budget, Finance, Treasury, Legal and Property offices - positions usually occupied by BAC members - as well as possible abuses, may be avoided.  

Also, the terms of reference and eligibility requirements for a certain undertaking must be submitted by the procuring entity to, and must be duly approved by, the Government Procurement Policy Board (GPPB), in order to avoid any suspicion of arbitrariness or partiality.

My suggestions may be incorrect: I don’t claim that I hold the surefire solution. However, RA 9184, as the cornerstone of the new dispensation of the pork barrel, is riddled with loopholes and ought to be reviewed and revised, lest all government biddings may very well be reduced to a mere “moro-moro,” with the Filipino taxpayers still ending up tragically as losers. Better yet, just abolish the pork barrel.

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