Andaya denies starting practice of early procurement

By Jose Cielito Reganit

February 13, 2019, 6:55 pm

MANILA -- House Appropriations Committee chairman and Camarines Sur Rep. Rolando Andaya Jr. denied on Wednesday Budget Secretary Benjamin Diokno’s claims that he started the practice of bidding government projects even before a budget bill is enacted into law.

“There is no truth to that allegation. It's fake news,” Andaya said in a statement sent to media.

He said during his time as DBM chief, there was no bidding and award prior to the effectivity of the General Appropriations Act (GAA), stressing that such activities commenced only after the enactment of the national budget.

“Unlike today, when biddings for projects conducted months before the signing of the national budget, prior to the passage of the law authorizing said expenditures, are the norm,” Andaya said.

Earlier, Diokno said the conduct of early procurement activities, short of award, was not new.

"It has been allowed since 2009, under the Arroyo administration with Andaya as Budget secretary,” Diokno said in a breakfast forum in Manila.

Diokno noted that the practice of bidding out projects prior to the enactment of the budget actually started with Circular 01-2009 that was issued by Andaya.

Under the circular, agencies can proceed with procurement activities prior to a Notice of Award, using as basis the National Expenditure Program (NEP).

In early procurement, the contract is not yet perfect until the GAA is passed, Diokno said.

The early procurement practice was also restated in DBM Circular Letter 2010-09, which allows agencies to proceed with procurement activities without awarding projects until the President approves the budget.

“This was also the practice during Abad’s time. We are just continuing it,” Diokno said, referring to former Budget Secretary Florencio Abad.

Diokno was responding to Andaya’s allegations that early bidding of new Department of Public Works and Highways (DPWH) projects for 2019 was made possible with Diokno's Circular Letter No. 2018-8 dated July 30, 2018.

The said circular prescribes the "Guidelines on the Conduct of Early Procurement for the Fiscal Year (FY) 2019 National Expenditure Program."

Under these guidelines, Andaya said Diokno allegedly instructed all heads of the Executive, Legislative and Judicial branches of government to "undertake Early Procurement Activities from October to December 2018, upon the submission of the FY 2019 NEP to Congress."

Andaya said these activities include pre-procurement conference until post-qualification of bids and recommendation by the Bids and Awards Committees to award the contract to the winning bidder.

He said the "Diokno Circular" eventually allowed the DPWH regional offices and district engineering offices to conduct bidding activities for the PHP75-billion infrastructure projects inserted in the NEP.

Andaya also alleged that favored contractors paid “commissions” or cash advances to get a slice of the PHP75 billion worth of infrastructure projects.

“Secretary Diokno, through his circular issued last year, enabled the commencement of a multi-billion conspiracy involving PHP75 billion of public funds. We are fed up with Sec. Diokno's lies and evasive antics. Sa korte na lang siya magpaliwanag (Let him explain it to the courts),” Andaya said.

However, Diokno repudiated the House leader’s allegations, stressing that the amount was not an insertion, but an adjustment to meet the infrastructure spending goal of 5 percent of the gross domestic product.

The PHP75 billion was later removed by lawmakers from the DPWH budget and realigned to other agencies.

Diokno also denied Andaya’s allegations that contractors paid commissions during the early procurement stage, stressing that early procurement does not tolerate advance payments or commissions.

Diokno pointed out that reputable contractors do not practice giving cash advances, saying the DBM is only in charge of crafting and overseeing the budget process.

“I do not know what the practice was when Andaya was Budget secretary but under our watch, advance payments or commissions are considered illegal,” he said.

“Such practices are not, and will not be, condoned by the Duterte administration. If Andaya know of such practices, and he clearly does, as he has been defending contractors, then he should name these personalities as they should be investigated,” Diokno said. (PNA)