Hard evidence

COA bares ‘cement scam’ in N. Vizcaya

BAYOMBONG, Nueva Vizcaya–The Commission on Audit (COA) has uncovered the provincial government’s illegal use of public funds to buy construction and agricultural supplies amounting to P24.2 million. 

In its 2007 audit report, the COA disclosed that the province bought building and farm materials, mainly bags of cement, from only two suppliers, without subjecting the transactions to public biddings as required by Republic Act 9184, or the Government Procurement Reform Act of 2003.

“(The lack of bidding) was not in conformity with RA 9184, which resulted in the failure of (the provincial government) in attaining a more transparent system of procurement,” the report said.

The COA said the provincial government resorted to “direct contracting” as an “alternative mode of procurement”, although this did not conform to any of the conditions set forth by Section 50 of the law.

RA 9184 mandates that all government purchases must be carried out through a “competitive public bidding”, with certain exceptions.

The law allows direct contracting, but only in cases where such purchase from an exclusive supplier is a requirement in a contract, and when the goods can be obtained exclusively from a specific dealer for which item no suitable substitute is available in the market.

Direct purchase may also be allowed for transactions worth P50,000 and below, provided that such purchases are not split into several contracts to comply with the limit.

Records showed that the province bought some P23.1 million-worth of construction materials, mainly cement, from Norma’s General Merchandise in Bagabag town, and more than P1 million in “farm inputs” from Igorot Buying Station, without any bidding.

“(The law) provides that, as a general rule, the procuring entities shall adopt public bidding as a general mode of procurement and shall see to it that the procurement program allows sufficient lead time for such bidding,” Julieta Mangulabnan, COA regional cluster director, said in her report.

Sources at the provincial government, who asked to be named for fear of reprisal, said Norma’s General Merchandise is owned by businesspersons supposedly close to high-ranking provincial officials.

This writer tried to reach Gov. Luisa Cuaresma for comment, but she was not in her office on Monday and could not be reached through her mobile phone.

However, Manuel Tabora, acting provincial administrator, said the provincial government had to buy materials through direct purchase because such mode was purportedly more advantageous to the provincial government.

“It could be observed (from purchase documents) that through public bidding, the cost of Portland cement is ranging (sic) from P187.50 to P188 per bag, shopping [price quotation method] (at) P187.49 to P187.90 and (by) direct contract, P185 to P187,” he said in a letter to Mangulabnan.

COA auditors, however, dismissed Tabora’s claim.

“The justification may be applicable to certain very urgent condition but could not be taken as basis to circumvent the real intent of the law,” the report stated.

Nueva Vizcaya officials continued to resort to direct purchases, the COA said, even after it has already warned them against such illegal practice in its 2006 report, then involving purchases of bags of cement, also from Norma’s General Merchandise, amounting to P5.7 million.

It said there was no proof that the materials, which were said to have been requested by private individuals and groups, were given to the end-users, citing documents which showed that the items were requested, and then confirmed as received, by Tabora himself.

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