Questions for COA (Part 2)


More than two years have now gone by since the anomalous bidding was conducted by the Iloilo City government for the City Hall building project with an approved budget for the contract (ABC) of P455 million. Apparently, the contractor, F. F. Cruz and Co./Freyssinet Filipinas joint venture, had already been paid its price tag of P368 million. The Commission on Audit (COA) did not find anything wrong with the bidding process and the project implementation.

With that irregularity having been allowed to go unmolested, COA, supposedly the official watchdog against corruption and fraud in government transactions, allowed the theft of more than a hundred million pesos. It validates the perception that COA has lost its sting, a toothless tiger that can hardly murmur its protest when powerful politicians snarl at its officials. It shows that its auditors play the role of the three monkeys — hear no evil, see no evil, speak no evil — to the detriment of the public interest.

But the negligence, incompetence and plain ignorance of COA auditors did not end there. In the middle of last year, City Mayor Jed Patrick E. Mabilog announced the supplementary works for the completion of the monumental anomaly would be awarded to the same contractor through negotiated procurement. In other words, the second contract wouldn’t undergo the competitive bidding process that is enshrined in Republic Act No. 9184, or the Government Procurement Reform Act.

Ostensibly, Mabilog wanted no delays in the project. At that time, he had wanted the building ready for inauguration when the city government celebrated its 74th charter day anniversary. It was apparent, however, he wanted to push the contract on a silver platter so that his bloated P260 million price tag won’t be reduced in a public bidding. That supplementary contract, as confessed by the city’s own project consultant, Conrado Goco, could be finished with just P45 million. Naturally, other bidders can offer to do it for P50 million and still reap big profits.

Efficiency and cost-cutting were apparently not in Mabilog’s agenda when he pushed for the award of the supplementary contract to the same contractor. He wasn’t inclined to make sure Ilonggo taxpayers are not burdened by extravagant, unnecessary expenses by its government. The obvious motivation is maximizing the “cut”, or the “kickback”. That purpose could not be achieved if the contract is undertaken through public bidding.

It was the media that raised the issue about a negotiated contract being inapplicable, hence, illegal, for the supplementary works. This forced Mabilog to seek the counsel of the COA if indeed he could not avail of a provision in RA 9184, particularly its Implementing Rules and Regulations, that defines the circumstances under which negotiated procurement is allowable. The phrase “adjacent and contiguous” is the general standard here, but it covers only similar scopes of work.

As Atty. Quintin Magsico, an expert on the government procurement law, put it, “you have to be able to compare apple with apple in computing the unit costs” for the new contract. In this case, that was not possible, because the scopes of work were entirely different from the original contract. The first contract involved civil works, or the structure itself, and involved concrete and steel bars. The second contract involved the electrical, plumbing, firefighting, data cabling, partitions and other components for the operation of an office building. There is no basis for price comparison.

I spoke with Ms. Ofelia T. Demegillo, the audit team leader of COA, and she disclosed the agency had advised Mabilog that the supplementary works would have to undergo public bidding. Basically, she validated our observation that the supplementary works didn’t meet the standards set by RA 9184 for negotiated procurement. After that meeting with COA, Mabilog also conceded defeat. He announced a “transparent and competitive public bidding” for Phase Two of the project.

The promised public bidding, however, never happened. Mabilog deceived his own constituents. He lulled the public into believing he would follow the law. The weeks went by, and nothing was heard from him. All of a sudden, sometime in October, workers of the project contractor were back at the site and resume their construction activities. The media noticed it, and asked Mabilog. Sheepishly, he admitted the contract had been awarded to the F. F. Cruz and Co./Freyssinet Filipinas joint venture.

What happened to the COA statement that the supplementary works did not fall under the “adjacent and contiguous” category? When probed by reporters, Mabilog and his chief legal officer Atty. Jose Junio Jacela said “COA advised us it was okay to do so.” Was there a change of heart on the part of COA?

COA owes the public an explanation. It can’t keep quiet on this issue. The first contract was a huge anomaly. The second contract is not yet fully paid, hence, there’s still an opportunity for COA to stop the hemorrhage of public funds. All in all, the city has earmarked P710 million for the project. About half of that amount represents the overprice. Will the COA give its stamp of approval?

If that happens, then we might as well seek the amendment of the constitution and disband COA. The City Hall project will be a monument to its ineptness in stopping corruption.

About Manuel "Boy" Mejorada
Manuel "Boy" Mejorada is a journalist and social media activist. A former Iloilo provincial administrator, he is now waging a crusade against corruption and narco-politics.

3 Responses to Questions for COA (Part 2)

  1. petmelliza says:

    That’s funny. During the time of Gov. Tupas, COA even had the nerve to pre-audit the catering of Jerry Bionat for disaster preparedness trainings. It would even send somebody to check if indeed Bionat did hold the seminars at the 5th floor of the Capitol. Kag may lakas loob pa nga mangayo pack lunch for two or more people. Mga bwisit!

  2. nelson robles says:

    I won’t be surprised Boy and Pet the way “watchdogs” of COA behave particularly the one housed at the Iloilo Provincial Capitol. Even the woman who was recently awarded as the “most outstanding regional employee” is also a rotten tomatoe. I should know because once I “gave her a piece of her mind” while she was still detailed at the capitol under the previous administration for her being ignorant of her job. I did make her cried a river. ‘Man sungaran mo!.Ako p

  3. I can’t help thinking that the Commission on Audit might have lost its relevance, its purpose. It has hardly scratched the surface in uncovering anomalous transactions in government. This is only making crooks in government more daring. As we have seen in the Iloilo City Hall project, these crooks don’t even bother to disguise their actions.

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