R.A. No. 9184: A World-Class Procurement System

The goal of public procurement is to award timely and cost-effective contracts to qualified contractors, suppliers and service providers for the provision of goods, works and services to support national and local government, and public services operations, in accordancewith principles and procedures established in the public procurement rules (Jorge Lynch, Goal of Public Procurement).

January 10, 2003, the Government of the Philippines (GoP) enacted R.A. 9184, otherwise known as the “Government Procurement Reform Act” (GPRA). The law consolidates over 100 procurement laws, rules, regulations and administrative issuances promulgated as early as 1901 when the Philippine Commission created the Bureau of Supply. Hailed by no less than the World Bank as “world class” procurement law, it took effect on January 26, 2003, fifteen (15) days following its publication in two (2) newspapers of general circulation.

Its implementing rules and regulations have been revised three (3) times: (i) Implementing Rules and Regulations (IRR) Part A dated 8 October 2003; (ii) Revised IRR of 2009 dated 2 September 2009; and (iii)  Revised IRR of 2016 dated 28 October 2016.

Governing Principles on Government Procurement

Section 3 of the procurement law provides that in all cases procurement shall be governed by the following principles:

• Transparency in the procurement process and in the implementation of procurement contracts;
• Competitiveness by extending equal opportunity to enable private contracting parties who are eligible and qualified to participate in public bidding;
• Streamlined procurement process that will uniformly apply to all government procurement. The procurement process shall be simple and made adaptable to advances in modern technology in order to ensure an effective and efficient method;
• System of accountability where both public officials directly or indirectly involved in the procurement process as well as in the implementation of procurement contracts and the parties that deal with the government are, when warranted by circumstances, investigated and held liable for their actions relative thereto; and
• Public monitoring of the procurement process and the implementation of awarded contracts with the end view of guaranteeing that these contracts are awarded pursuant to the provisions to the procurement law and its implementing rules and regulations and that all these contracts are performed strictly according to specifications.

Key Features of RA 9184 and its 2016 IRR

RA 9184 and its 2016 IRR have the following key features:

1. Covers procurement of all government agencies. (NGAs, GOCCs, SUCs, GFIs LGUs, Judiciary, Legislative and Constitutional Commissions).
2. The general mode of procurement is Public/Competitive Bidding.
3. Alternative Methods of Procurement allowed in highly exceptional cases.
4. Approved Budget for the Contract (ABC) as the ceiling for the bid price.
5. Use of transparent, objective and non-discretionary “pass/fail” criteria in the evaluation of bids.
6. Increased transparency in the procurement process.
7. Professionalization of procurement officials.
8. The inclusion of Penal, Civil and administrative penalties.
9. Embedding of global public procurement “best” practices.

Better Procurement System

The consolidation of various procurement laws and issuances,  its “codification” and the embodiment of global public procurement “best” practices into one document, indeed makes the existing procurement system “world class”. Being well structured and organized, it is easier to read and understand, hence can be readily applied, observed and enforced by the stakeholders in all procurement projects.

However, having a good procurement system is not a guarantee that it will work. It requires that all key players perform their respective prescribed role to make it work. This is now the greatest challenge to all stakeholders.

This challenge is crucially pivotal on the part the Government Procurement Policy Board (GPPB) which under the law, is responsible for ensuring the proper implementation and review of the effectiveness of the procurement law (Section 63.1 (d) and (f) of 2016 IRR of RA 9184).

On our part, we can help enhance the effectiveness and efficiency of our procurement system by sharing this information to those whom we know are involved in public procurement activities.

(Oscar M. Manuel is a certified Public Procurement Specialist (L1). Provides consultancy services to government Suppliers/Manufacturers/Contractors and procurement officials on procurement related concerns through OMM Consulting).

Market Survey: A Must in Developing Project Requirements

Government agencies and instrumentalities are created and established to carry out activities for public welfare. These activities pertain to basic services, like national defense, public works, education, social welfare, and all others which are intended to benefit the public.

Government Requirements and Procurement Rules

These agencies are provided with the corresponding budgetary allocations for the procurement of its requirements which are crucial to the efficient discharge of the governmental functions for which it is established, and in accordance with procurement rules and regulations, and Government Procurement Manuals. A requirement is considered crucial to the efficient discharge of governmental functions if it is required for the day-to-day operations or in the pursuit of the principal mandate of the agency.

Procurement Planning

Development of Project Requirements

The procurement rules require the Procuring Entity to undergo procurement planning in the conduct of its procurement functions. At this stage, it requires the agency to prepare a proposed Project Procurement Management Plan (PPMP) which the project requirements are developed. It is at this stage of procurement planning that the Project Management Office (PMO) or the end- user unit must:

a. Identify the need. What is the purpose of the procurement project? What are the problems or needs that project or procurement aims to address?

b. Identify the alternative solutions/products/services available in the market. What alternative solutions to the problems or needs available in the market. What is the profile of the supply market? Are they easily obtainable? How much is the cost of each alternative?

c. Compare the alternatives (consider the quantitative and qualitative factor). It will rate the various alternatives in terms of the following: i) Value of money; ii) Risk Assessment Management; iii) Government policies that have an impact on the project or procurement; iv) Other relevant factors that may be identified by the PMO or the end-user unit.

d. Choose from among the alternatives the one that is most beneficial to the Procuring Entity, and make the necessary recommendation to the approving authority.

Writing Technical Specifications

The technical specifications is the document that provides the detailed descriptions of the deliverables of the supplier. It refers to the physical descriptions of the goods and the requirements in terms of the functional, performance, environmental interface and design standards that will be met by the goods to be manufactured or supplied.

Determining the Approved Budget for the Contract (ABC)

The ABC refers to the budget for the contract approved by the Head of the Procuring Entity, as provided for by the GAA. Its various components includes: 1) The cost or the market price of the product; 2) Incidental expenses like freight, insurance, taxes, installation costs, training costs, and cost of inspection.

Method of Procurement

 As a general rule, all procurement should be through public bidding. This is the policy of the GoP, as laid down in R.A. 9184. However, the law recognizes that certain unique circumstances require the use of other methods of procurement. The selection of the method of procurement is dependent on the presence or absence of specific conditions that justify the use of a particular method (e.g. if the product is patented or copyrighted, direct contracting is the preferred mode instead of public bidding),

The Market Survey

 The information required in the various components of procurement planning, from the development of project requirements, in the preparation of the technical specifications, determination of ABC and the mode of procurement, can be found and sourced out in the market, hence the need to conduct a market survey. The most comprehensive source of product information is the market itself. The information gathered therein, together with the information from product brochures, technical publications, industry newsletters, the industry itself, will enable the Procuring Entity to make an informed choice in the conduct of its procurement concerns.

More importantly, the conduct of market survey constitutes due diligence in the exercise of an official function duly authorized by the procurement law.

So that when the PMO or the end-user unit with the exercise due diligence express its preference for a specific product it wants to procure to address a concern in pursuit of principal mandate, and it is approved by the Head of the Procuring Entity, the choice should be respected by the agency which have regulatory, oversight or supervisory functions over the concerned Procuring Entity.

This should be so considering that it is an act duly authorized by law and as such, should be maintained and respected by all others. This is an expression of a Republican state- a government of laws, not of men.

(Oscar M. Manuel is a freelance government marketer. He can be reached at www.facebook.com/OMMMarketingConsulting, his email address at omcs03@yahoo.com or through his mobile number 09275802340).

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Steps in Capturing Government Contracts

Success in capturing government contracts is not due to luck or an “anointment” from above. It came about after a series of trial and error. It is earned through hard work by strictly adhering to the procurement rules and religiously providing what the Procuring Entity (PE) wants, as stipulated in the Bidding Documents.

In my almost 3 decades of attending public biddings, I have conceptualized steps that greatly enhance the chances of capturing contracts and succeed in government contracting. These steps will reliably shorten the learning curve of those suppliers who intend to cater to government needs. These steps are as follows:

Step 1: Prepare Business Credentials, Registration and  Licenses

There are mandatory business credentials that have to be submitted when responding to an ITB or RFQ. To mention some, these are the DTI or SEC Registration, Mayor’s Permit, BIR Registration, Tax Clearance, Financial Statements, and others which may be required by the PE.

Failure to submit any of this requirement will be a ground for disqualification of the proposal.

 Step 2: Conduct Early Project Prospecting

 Knowing about the implementation of a certain procurement project at the time of its publication in PhilGEPs or in the newspaper would already be too late, since the timeline prescribed until the submission of proposal would not be enough to conduct a thorough evaluation to determine whether to participate in the project, or in preparing a winning proposal.

An ideal time to undertake project prospecting is during the last quarter of the year before the project is to be implemented. This can be done by accessing the National Expenditure Program (NEP) prepared by the Executive Department and submitted to Congress as the basis of the General Appropriations Act of the following year. In this document, all major projects of the entire government are listed.

The Annual Procurement Plan (APP) that is prepared by each and every government agency is also an ideal source of project information. Under E.O. No. 662, series of 2007, this is to be submitted to the GPPB on or before the before the end of January of the budget year and be posted.

 Step 3: Monitor Publication of ITB/RFQ and Study Bid Documents

 Upon publication of the project in the PhilGEPs, in the newspaper or at the website of the implementing agency, you can then access its particulars or specifics by downloading it from the PhilGEPs or Agency’s website. The project evaluation will then commence. The purpose of this evaluation is to determine whether it will advisable to participate in the bidding or submit a proposal (in case of an alternative method of procurement) on the basis of the entire project information. You can buy your bid documents before or after the pre-bid, but definitely before dropping your bid.

 Step 5: Make Strategic Use of the Pre-bid Conference

 The Pre-bid conference is crucial in preparing bid proposal. It is this time that you can clarify any aspect of the bidding that needs to be clarified. This is also the time that you can make some strategic clarifications for the purpose of disqualifying of any competition that you may find subject to any ground of disqualification.

 Steps 5: Preserve and Protect Your Proposal

 During the preliminary examination of bids which is the time for the bid proposal to be determined if it complied with all the eligibility, technical and financial documents required to be submitted, you should be very vigilant in observing if the proceedings  conducted is in accordance with the “pass/fail” criterion established by the rules.

And in finding that there is any irregularity committed by the BAC, then be ready to manifest your question, and if they fail to rectify it, you should manifest that you are reserving your right to make a written reconsideration to this effect.

 Step 6: Monitor the Bid Evaluation Without Violating the “No Contact Rule”

 You should be closely monitoring the progress of the evaluation of bid proposals. Most especially if your bid is the Lowest Calculated Bid (LCB), you should be closely coordinating with the BAC Secretariat for the schedule of the Post-Qualification process, Notice of Award, submission of contract requirements and its signing, until the issuance of Notice to Proceed.

Even if your bid is the 2^nd lowest calculated bid, you still have to monitor the progress of the post-qualification of the LCB for possible post-disqualification.

Step 7: Conduct a Post-Project Evaluation

 Win or lose, you need to conduct a post evaluation of the entire project proceedings. Knowing what was the reason of winning the contract will enable you to acquire a strategy that you can use in future biddings, otherwise you at least you can learn something that you will not repeat again in the future.

Write your comments below. And if you want to receive future posts, just click the comment box and notification thru email below.

(Oscar M. Manuel is a certified public procurement specialist. He provides consultancy services to suppliers and government procurement officials on procurement concerns. He can be reached at www.facebook.com/OMMConsulting, at his email address at omcs03@yahoo.com or through his mobile number 0933 249 6612).

Tips for New Procurement Officials: Foundational Steps Toward Proficiency

Congratulations!

To be among the procurement officials, either as the Head of the Procuring Entity (HoPE) by virtue of your office, or a duly designated member of the Bids and Awards Committee (BAC), BAC Secretariat and Technical Working Group (TWG) is a great opportunity. As such, you are afforded with an opportunity to learn and develop a skill in procurement management that will add to your qualification for career growth in the area of public administration.

Just like any other skill, however you need to acquire basic knowledge and skills in order to become effective and proficient in the performance procurement management functions. Over the years, I have come to the conclusion that these are as follows:

1.  Study the Procurement Law, Rules and Regulations

 Our procurement system is governed by a legal framework (procurement rules) consisting of procurement rules or regulations. Currently, we have the R.A. 9184 otherwise known as the “Government Procurement Reform Act” (GPRA) and its 2016 Implementing Rules and Regulations. These further developed into policies and procedures, procurement manuals and guidelines, including standard bidding documents and mandatory forms which are used for biddings and in alternative methods of procurement.

There are also Government Procurement Policy Board (GPPB) and Commission on Audit (COA) circular, guidelines and opinion related to the conduct of procurement activities.

You should study and get familiar with these documents and issuances because these are the basis in determining the propriety and validity of particular procurement act. You should start with the a procurement law, its rules and regulations, the circulars, guidelines and manuals and the various bidding documents of each procurement category.

The procurement rules govern everything from procurement planning, the conduct of the bidding and up to the contract administration. You should take note what are directory issuances and the mandatory rules that will invalidate an act and even lead to an actionable infraction.

2. Understand the Stages and Process of Procurement

The procurement system consists of various processes that are completed in successive stages. It is important for you to learn these processes and stages in which you will be involved and more importantly for those you are directly responsible.

3. Develop and Use Checklist

In course of your study of the procurement rules and procedures, you will learn the various requirements in each specific stage of procurement. You must develop and prepare a Checklist of these requirements.

This will be an additional list that is provided as a mandatory Checklist of Requirements during the bidding process in each procurement category provided by the procurement IRR of R.A 9184.

Checklist is important in your effort to become proficient in procurement responsibilities since they will allow you to remember all the steps and its requirements needed to complete a process, so you don’t have to rely in your memory. This is crucial in public procurement where there are several stages and processes, with its corresponding requirements that need to be followed and submitted, and where missing a step or failure to submit may be a cause for nullification of an action or even a basis for disciplinary action.

4. Study Public Procurement Principles and Code of Conduct and Ethical Standards for Public Officials

 The Governing Principles on Government Procurement embodied in R.A. 9184 are the foundation of our procurement system. This will serve as guides in making procurement related decisions.

And being a public officer, your actions are regulated by a Code of Conduct and Ethical Standards for Public Officials and Employees prescribed in R.A. 6713. By integrating the procurement governing principles into your work ethic, your decision will always be consistent with the goals of public procurement.

 5. Find a Mentor and Strive to Continually Improve

 To be able to have a mentor in the course of learning the intricacies of public procurement will greatly enhance and facilitate your learning process. And of course, there is the internet that will provide with more than adequate resources need for you to become effective and proficient in the performance of your procurement functions.

Feel free to write your comments below. And, if you find this article helpful, feel free to share it with your fellow procurement practitioner.

(Oscar M. Manuel is a certified public procurement specialist. He provides consultancy services to suppliers and government procurement officials on procurement concerns. He can be reached at his fb business page: http://www.facebook.com/OMMConsulting) or through his mobile number 0933 249 6612.

HoPE: No Automatic Liability On Procurement Related Disallowance

All heads of offices have to rely to a reasonable extent on their subordinates and on the good faith of those who prepare bids, purchase supplies, or enter into negotiations(Amado C. Arias vs. Sandiganbayan (259 Phil. 794, 1989).     

Designed to make the procurement system effective and efficient, the procurement rules created various units/entities and delegated specific duties and responsibilities in various stages of procurement.

Under the 2016 Implementing Rules and Regulations of R.A. 9184,  these are the following:

1. Head of Procuring Entity (HoPE)  responsible for the following functions: 1.) Approved the Annual Procurement Plan (APP) (Section 7.2); 2.) Determination outsourcing of procurement tasks (Section 7.3.3); 3.)Designate members of the BAC (Section 11.2.1); 4.); Create BAC Secretariat and Procurement Unit (Section 14.1); 5.) Preparation of the Bidding Documents (17.1); 6.) Approve or disapprove the recommendation of the BAC the award of the contract (Section 37.1.2); 7.) Issuance of Notice to Proceed; 8.) Approve the recommendation of the BAC for the adoption of an Alternative Method of Procurement (Section 48.1); and 9.) Resolve protest (Section 56).
2. Bids and Awards Committee (BAC) with the following functions: (a) advertise and/or post the invitation to bid/request for expressions of interest; (b) conduct pre-procurement and pre-bid conferences; (c) determine the eligibility of prospective bidders; (d) receive and open bids; (e) conduct the evaluation of bids; (f) undertake post-qualification proceedings; (g) resolve requests for reconsideration; (h) recommend award of contracts to the HoPE or his duly authorized representative: (i) recommend the imposition of sanctions in accordance with Rule XXIII; (j) recommend to the HoPE the use of Alternative Methods of Procurement as provided in Rule XVI hereof; k) conduct any of the Alternative Methods of Procurement; l) conduct periodic assessment of the procurement processes and procedures to streamline procurement activities pursuant to Section 3(c) of this IRR; and m) perform such other related functions as may be necessary, including the creation of a Technical Working Group (TWG) from a pool of technical, financial, and/or legal experts (Section12.1).
3. Technical Working Group (TWG) which will assist the BAC in the following: 1.) Review of the Technical Specifications, Scope of Work, and Terms of Reference; 2.) Review the Bidding Documents; 3.) Shortlisting of Consultants; 4) Eligibility of Screening; 5.) Evaluation of Bids; 6.) Post-Qualification; and 7.) Resolution of Request for Reconsideration (12.1).
4. Observers who will sit in the BAC’s proceedings during the eligibility checking, shortlisting, pre-bid conference, preliminary examination of bids, bid evaluation, and post-qualification to enhance transparency (Section 13).
5. BAC Secretariat which shall serve as the main support unit of the BAC. It has the following functions and responsibilities: a) Provide administrative support to the BAC and TWG; b) Organize and make all necessary arrangements for BAC and TWG meetings and conferences; c) Prepare minutes of the meetings and resolutions of the BAC; d) Take custody of procurement documents and other records and ensure that all procurement undertaken by the Procuring Entity are properly documented; e) Manage the sale and distribution of Bidding Documents to interested bidders; f) Advertise and/or post bidding opportunities, including Bidding, including Bidding Documents, and notice of awards; g) Assist in managing the procurement process; h) Monitor procurement activities and milestones for proper reporting to relevant agencies when required;  i) Consolidate PPMPs from various units of the Procurement Entity to make them available for review as indicated in Section 7 of the IRR and prepare APP; and j) Act as the central channel of communication for the BAC with end-user or implementing units, PMOs, other units of line agency, other government agencies, providers of goods, infrastructure projects, and consulting services, observers, and the general public (Section 14.1).

 As above enumerated, each entity involved in the procurement process is directly responsible for specific functions. Under this arrangement, what is then its relationship with the HoPE in as far as the performance of its respective functions are concerned? Particularly, if the BAC committed a mistake or violated any procurement rule, is the HoPE also automatically liable by the mere signature or approval appearing in the voucher for payment?

In its decision dated November 7, 2017, the Supreme Court in the case of Tomas Joson III vs. Commission on Audit (G.R. No. 223762, November 7, 2017) reiterated a general policy relative to this issue.

In this case, Petitioner Tomas Joson III, Provincial Governor of Nueva Ecija, as Head of the Procuring Entity challenged the Decision dated January 29, 2015 and Resolution dated January 19, 2016 rendered by the Commission on Audit (COA) in Decision No. 2015-019 denying his Exclusion from Liability and affirming the Notice of Disallowance (ND) L-09-05-005 (2004-2007).

The COA’s primary ground of the disallowance is the finding of the Special Audit Team (SAT) that there was an irregular award made by the Province of Nueva Ecija on the construction of Nueva Ecija Friendship Hotel to A.V.T. Construction, an ineligible contractor, for the reason that its prequalification or eligibility checklist using the “pass/fail” criteria, the Net Financial Contracting Capacity (NFCC), and Technical Eligibility documents were missing. It is therefore contrary to the provisions of Section 21 and 23 of the IRR of R.A. 9184.

Petitioner Joson argued in his Petition for Exclusion from Liability that he should not be held liable for the disallowance since the determination of whether the bidder is eligible or not is the exclusive responsibility of the BAC and if there is indeed a liability, the members of the BAC should be held liable since they are the persons directly responsible for the transaction.

The COA maintained in the questioned decision that the Petitioner is liable on the disallowance  since he failed to exercise due diligence in the performance of his duty.

The Supreme Court in granting the petition ruled that:

“xxx in the landmark case of Arias v. Sandiganbayan, this Court held that the head of the office or agency can rely to a reasonable extent on the good faith of their subordinates, thus:

“We would be setting a bad precedent if a head of office plagued by all too common problems-dishonest or negligent subordinates, overwork, multiple assignments or positions, or plain incompetence-is suddenly swept into a conspiracy conviction simply because he did not personally examine every single detail, painstakingly trace every step from inception, and investigate the motives of every person involved in a transaction before affixing, his signature as the final approving authority.

xxxxxx

 “All heads of offices have to rely to a reasonable extent on their subordinates and on the good faith of those prepare bids, purchase supplies, or enter into negotiations.

xxxxxx

“There should be other grounds than the mere signature or approval appearing on a voucher to sustain a conspiracy charge and conviction.”

 With this judicial determination, it will appear that under the procurement law, the accountability lies where the direct responsibility is lodged.

Write your comments below. And if you want to receive future posts, just click the comment box and notification thru email below.

(Oscar M. Manuel is a certified public procurement specialist. He provides consultancy services to suppliers and government procurement officials on procurement concerns. He can be reached at www.facebook.com/OMMConsulting, at his email address at omcs03@yahoo.com or through his mobile number 0933 249 6612).

Alternative Methods of Procurement: More Economical and Efficient Mode

In his speech on Public Sector Reforms of the Duterte Government: Challenges and Its Future, Budget  Secretary Benjamin E. Diokno, reported that in  2017 the government began the shift to one-year validity of appropriations to address government underspending.

By 2019, the government take the reforms further by shifting to an annual cash-based budget, from an obligation-based budget. Under this budget system, the budget is considered “spent,” the inspection, verification, actual payment, and delivery of goods and services must be within a fiscal year. Thus, enabling the timely implementation of government programs and projects.

Towards this end, the Department of Budget and Management (DBM) issued Circular Letter No. 2018-8 dated July 30, 2018, Prescribing Guidelines on the Conduct of Early Procurement for Fiscal Year (FY) 2019 National Expenditure Program (NEP). All agencies covered by this directive shall undertake Early Procurement activities, from October to December 2018, upon submission of NEP to Congress. Early Procurement activities shall refer to pre-procurement conference until qualification of bids and recommendation by the Bids and Awards Committee (BAC) to award the contract to the winning bidder, in accordance with Section 7.6 of 2016 IRR of RA 9184 and Section 19 of the General Provision of the FY 2019 NEP.

This was made possible with the revision of the IRR of R.A. 9184 in 2016 which streamlined procurement processes that derails program implementation.

In 2017, President Rodrigo R. Duterte issued Executive Order No. 34, amending Section 4 of Executive Order No. 423, which requires an opinion of the Government Procurement Policy Boad (GPPB) that a Government contract falls within the exception from public bidding. Under this directive, where the Head of Procuring Entity has made a determination that  a Government contract falls under any of the exceptions described in Sections 48 to 53 of RA 9184, the Head of Procurement Entity may proceed with the alternative methods of procurement according to the law and applicable rules and regulations.

Alternative Methods of Procurement

Section 48 of the 2016 Implementing Rules and Regulations outlined the basic requirements and conditions in the adoption of any of the alternative methods of procurements:

Subject to the prior approval of the HoPE, and whenever justified by the conditions provided in this Act, the Procuring Entity may, in order to promote economy and efficiency, resort to any of the alternative methods of procurement provided in this Rule. In all instances, the Procuring Entity shall ensure that the most advantageous price for the Government is obtained (48.1).

In accordance with Section 10 of this IRR, as a general rule, the Procuring Entities shall adopt competitive bidding as the general method of procurement and shall see to it that the procurement program allows sufficient lead time for such competitive bidding. Alternative methods of procurement shall be resorted to only in highly exceptional cases provided for in this Rule (48.2).

The method of procurement to be used shall be as indicated in the approved APP. If the original method of procurement recommended in the APP was competitive bidding but cannot be ultimately pursued, the BAC, through a resolution, shall justify and recommend the change in the method of procurement to be approved by the HoPE. Such changes must be reflected in the APP to be submitted to the GPPB, pursuant to Section 7.4 of this IRR.(48.3)

The HoPE may resort to any of the following alternative methods:

1) Limited Source Bidding.(49); 2) Direct Contracting (50); 3) Repeat Order (51); 4) Shopping (52); and

5) Negotiated Procurement (53); 5.1 Two Failed Biddings (53.1); 5.2 Emergency Cases (53.2); 5.3 Take-Over of Contracts (53.3); 5.4 Adjacent or Contiguous (53.4); 5.5 Agency-to-Agency (53.5);  5.6 Scientific, Scholarly or Artistic Work, Exclusive Technology and Media Services (53.6); 5.7 Highly Technical Consultant (53.7); 5.8 Defense Cooperation Agreement (53.8); 5.9 Small Value Procurement (53.9); 5.10 Lease of Real Property and Venue (53.10); 5.11 NGO Participation (53.11); 5.12 Community Participation (53.12); 5.13 United Nations Agencies, International Organizations or International Financing Institution (53.13).

Section 54 of the IRR provides Terms and Conditions for the use of Alternative Methods.

Section 54.7  thereof provides for the specific terms, conditions and documentary requirements, including the limitations and restrictions for the application of each of the alternative methods which shall be provided for in Annex “H” of the IRR and guidelines specifically issued for this purpose.

Under R.A. 9184 and its IRR, the authority to approve or disapprove the use of alternative modes of procurement, regardless of the amount of the Approved Budget for the Contract (ABC) lies with the Head of Procuring Entity or his duly authorized representative, who shall be accountable for determining whether all the required conditions are present for the use of the proposed alternative method of procurement.

Careful evaluation of the various alternative methods of procurement will reveal that it can only be resorted to upon the approval of the HoPE, in order to promote economy and efficiency. This is the reason why the processing is shorter, with less elaborate Bidding Documents and requires less time than the regular public bidding. More importantly, it is only applicable to a particular, specific and duly defined conditions. Its adoption is subject to an appropriate terms and conditions, together with its respective securities and warranties and documentary requirements.

It can be reasonably maintained that with the strict observance and compliance of the conditions, terms and requirements prescribed by R.A. 9184 and its IRR, including issuances of other regulating agencies, resorting to an appropriate alternative method of procurement will achieve a more optimal and expedient procurement system.

In actual practice though, many HoPE are reluctant and hesitant in resorting to an alternative method of procurement for fear that the COA will consider it as irregular, unnecessary, excessive, extravagant, or unconscionable expenditure of public, which will be the basis of the issuance of Audit Observation Memorandum (AOM), Notice of Suspension (NS) or Notice of Disallowance (ND).

This attitude pervades due to the belief that COA has control function over the acts of procurement officials, which is not the case. The Auditor can only disallow transactions which are irregular/unnecessary/ and extravagant as defined in COA Circular No. 85-55A as well as other COA issuances, and those which are illegal and unconscionable (Section10.1, The 2009 Rules and Regulations on the Settlement of Accounts). It should be emphasized here that the COA can only validly disallow if there is a law, rule, standard,  procedure or regulation violated.

This is so since the COA only exercises administrative supervision over the agency, which is limited to the authority to generally oversee the operation of the said agency to ensure that it is managed effectively, efficiently and economically but without interference with day-to-day activities. Conduct management audit, performance evaluation and inspection to determine compliance with policies, standards and guidelines of the agency (Section 36 (2), Book IV, Chapter 7, Executive Order No. 292).

It stands to reason that for as long as the HoPE observe and comply strictly all the conditions, terms and requirements laid down in the procurement law and its IRR, in adopting a particular alternative mode of procurement, the COA should pass it on audit.

As a matter of fact, COA’s Guide in the Audit of Procurement (First Updated-2009) embodied in its  Memorandum No. 2010-003 dated January 14, 2010, pertains only to the determination of compliance and observance of the conditions, terms and requirements prescribed by the pertinent provisions of the R.A. 9184 and its IRR, for a particular method of procurement.

As a matter of government practice, the bulk of government procurement projects are usually implemented in the last quarter of the year. And, with the implementation of the cash-based budget system for FY 2019,  which prescribed the conduct of Early Procurement activities in the same period, it appear that the need to adopt an alternative methods of procurement pursuant to R.A. 9184 and its IRR is  not only necessary but imperative.

(Oscar M. Manuel is a freelance government markete. He can be reached at www.facebook.com OMMConsulting , at his email address omcs03@yahoo.com or through his mobile number 0933 249 6612).

Procurement Planning: HoPE Formidable Challenge under the Cash-Based Budget System

Through plans, a Procuring Entity is able to effectively manage and track procurement all the way to contract performance. As such, it allows managers to determine how to allocate limited cash and other appropriate resources under a given time line and identify choke-points, weaknesses, and delays in the entire activity that can be addressed or eliminated. (GPM, Vol. 1, p.33)

If at this very moment we will conduct a 5-year assessment of how well the various  government agencies plan their respective procurement projects, I can maintain with reasonable certainty that more than half of these agencies will get an unsatisfactory rating.

Let me substantiate.

We are now facing a “national catastrophe” due to the impact of soaring prices of rice.

According to the latest price monitoring report of the Philippine Statistics Authority (PSA), the average retail price of regular milled rice rose to P43.86 per kilo during the 4th week of August, while well-milled rice soared to P47.12.

These prices were 15.2% and 11.6% higher compared to prices during the same period last year.

Prices of rice began to soar when the state-run National Food Authority (NFA) announced that its stocks had become depleted. The NFA said its buffer stock has good to last for only seven days as of the fourth week of August.

As reported, one of the causes of the blunder is the diversion of the NFA’s stabilization fund to debt repayment!  For this diversion, which led “to failure to ensure stabilized supply and prices of staples,” two NFA officials are now facing graft case at the Office of the Ombudsman, filed by the Agriculture group Samahang Industriya ng Agrikultura or Sinag.

Last December 2015, the Department of Health (DoH), under its Anti-dengue campaign, procured 3 million doses of Dengvaxia from Sanofi Pasteur, costing the government P3 billion, only to be suspended after being informed by the drug maker that the vaccine provides persistent protective benefits against dengue fever in those who had prior infection, but not for those without prior infection.

The dereliction did not only endanger the lives of our school children injected with the vaccine, deprived our people of the benefits of the billions of pesos if utilized in proper way, but what is worst is that even now DoH has to urged the Senate to pass the P1.6-billion medical support fund for students who received Dengvaxia dengue vaccine. This fund will be used to shoulder the medical expenses and monitor the health of over 870,000 who got the dengue vaccine.

Our law enforcers did not want to be left behind in demonstrating its procurement ineptitude.

March 2015, the Philippine National Police through the Procurement Service of the Department of Budget Management (PS-DBM), purchased P1.54-billion 1,656 Mahindra Enforcers—patrol vehicles intended for police stations nationwide.

And again in December 2015, the PNP on its own, purchased for P349-million 398 Mahindra Scorpios—SUVs intended for ranking PNP officers.

As reported by the Commission on Audit (COA), the vehicles turned out to be high in fuel consumption, frequent breakdown, poor after sales services and limited availability of spare parts.

I will only cite 3 major government agencies not because I am running out of samples but, I am running out of breath!

On the other hand, while it is expected that the agencies will fully utilize the allocated funds for programs and projects, there are several government agencies with “low obligation” or disbursement rate throughout the years.

Senator Loren Legarda, chairperson of the Senate Committee on Finance, noted that among the programs of government that have registered low obligation and disbursement rate throughout the years include: the Health Facilities Enhancement Program (HFEP) under the Department of Health (DoH), the Farm-to-Market Roads (FMR) projects under the Department of Agriculture (DA), and the Basic Educational Facilities Fund (BEFF) under the Department of Education (DepEd).

From 2008 to 2018, the HFEP had total allocation of P138 billion but only P73 billion were obligated and only P13 billion of which, or less than 10% of the total funds, were actually disbursed.

In 2015, BEFF was worth P54 billion, but only P39 billion were obligated and P7 billion were disbursed.

In 2016, its budget was P82 billion, of which P59 billion were obligated and only P16 billion were disbursed.

She said that of the P119 billion appropriated to the fund in 2017, P114 billion were obligated, and only P7 billion were disbursed.

The DA’s disbursement rate for FMR in 2014 was “very low” at 5.9% or only P708 million of the P12 billion appropriations (http://politics.com.ph, September 10).

Senator Legarda will be scrutinizing the budget of these agencies with low disbursements rates in the  2019 budget which is now cash-based as a way to ensure efficient spending of government funds and implementation of projects.

Procurement Planning and Budgeting Linkage Under the 2016 IRR of R.A. 9184 and Government Procurement Manual

The existing procurement law, its implementing rules and regulations, and other issuances provide adequate and sufficient authorities, policies and guidelines to enable government procurement officials to prepare an effective and efficient plan that will ensure that the overall goal of the particular project will be achieved effectively and efficiently.

Through plans, a Procuring Entity is able to effectively manage and track procurement all the way to contract performance. As such, it allows managers to determine how to allocate limited cash and other appropriate resources under a given time line and identify choke-points, weaknesses, and delays in the entire activity that can be addressed or eliminated.

It is clear in the IRR that “All procurement shall be within the approved budget of the Procuring Entity and should be meticulously and judiciously planned by the Procuring Entity. Consistent with government fiscal discipline measures, only those considered crucial to the efficient discharge of governmental functions shall be included in the Annual Procurement Plan (APP). For purposes of this IRR, a procurement project shall be considered crucial to the efficient discharge of governmental functions if it is required for the day-to-day operations or is in pursuit of the principal mandate of the Procuring Entity concerned. The APP shall include provisions for foreseeable emergencies based on historical records. In the case of Infrastructure Projects, the APP shall consider the appropriate timing/phasing of related project activities, such as, engineering design and acquisition of right-of-way site or location, to reduce/lower project costs” (7.1).

“No procurement shall be undertaken unless it is in accordance with the approved APP, including approved changes thereto. The APP must be consistent with the duly approved yearly budget of the Procuring Entity and shall bear the approval of the HoPE or second-ranking official designated by the HoPE to act on his behalf” (7.2).

“Upon issuance of the budget call in the case of NGAs, SUCs, Constitutional Commissions or Offices, or similar document for GOCCs, GFIs and LGUs, the Procuring Entity shall prepare its indicative APP for the succeeding calendar year to support its proposed budget taking into consideration the budget framework for that year in order to reflect its priorities and objectives” (7.3.1).

The Government Procurement Manual, Vol. 1, Section 3, provides guidelines and procedures in the conduct of Procurement Planning.

Particularly, it prescribed guidelines in the preparation of the Project Procurement Management Plan (PPMP), Developing the Project Requirements, Writing the Technical Specifications, Scope of Works and Terms of Reference, Determining the Approved Budget of the Contract (ABC), Procurement Milestones, Method of Procurement, Format of PPMP (prepared by the PMO/end-user unit), the Preparation of the Annual Procurement Plan (APP), its Procurement Strategy and its Format.

Volume 2 of the Government Procurement Manual which is the Manual of Procedure for the Procurement of Goods and Services, prescribed the Procurement Planning for Goods, Factors to be considered in planning, What are Technical Specifications, Factors to be considered in its preparation, What is the ABC and the factors to be considered in its preparation.

The Cash-Based Budgeting System for Fiscal Year 2019

The Duterte government pushed for a cash-based budget in 2019 to promote fiscal discipline and better planning among agencies in spending or using their resources. A purely cash-based budgeting system limits contractual obligations and disbursing payments to goods delivered and services rendered within the fiscal year.This means implementing agencies would need to complete their contracts by the end of 2019, regardless of possible delays. Projects that are “not implementation-ready” will be removed from the proposed budget (Rappler, August 30).

In consonance with this system, the Department of Budget and Management (DBM) issued Circular Letter No. 2018-8 dated July 30, 2018, Prescribing Guidelines on the Conduct of Early Procurement for Fiscal Year (FY) 2019 National Expenditure Program (NEP).

Under the guidelines, all agencies covered therein shall undertake Early Procurement activities, from October to December 2018, upon the submission of the NEP to Congress. Early Procurement activities shall refer to pre-procurement conference until post-qualification of bids and recommendation by the Bids and
Awards Committee (BAC) to award the contract to the winning bidder, in accordance with Section 7.6 of the 2016 Implementing Rules and Regulations (IRR) of RA 9184 and Section 19 of the General Provisions of the FY 2019 NEP.

A Formidable Challenge

The problems of soaring prices of rice, suspension of projects, procuring vehicles with inadequate after sales service and non-availability of spare parts are only few of the myriad effects of poor procurement planning. The foundational nature of proper planning as a means of achieving procurement goals and objectives is pivotal and critical in nature, and is primarily the responsibility of the government procurement officials.

Aggravating the formidability of this task, is the adoption of a Cash-Based Budget System which has an effect of cutting into half  the time available for program and project implementation as provided in an obligation-based budget system.

The HoPE is now facing the challenge of developing a sustainable strategy to strengthen the capacity of its procurement officials to fully understand and implement the procurement rules and regulations.

(Oscar M. Manuel is a freelance government marketer offering his  services  nationwide. He can be reached at www.facebook.com OMMConsulting or at his email address omcs03@yahoo.com or through his mobile number 0933 249 6612)

 

 

 

 

 

“Most Responsive Bid”?

The BAC shall recommend to the HoPE the award of contract to the bidder with LCRB xxxxxx after the post-qualification process has been completed. (Section 37.1 of 2016 IRR of R.A. 9184)

Nowadays you can read in the newspapers questions about awards of contracts after the conduct of public bidding.  Questions why the contract was awarded to a bidder which is not the lowest during the opening of bids, why despite non-compliance of a “minor” specifications is still awarded to the lowest bidder. Is the bidder entitled to an award despite that he abandoned a previous contract? Why does the HoPE awarded the contract to a bidder not recommended by the BAC? Is it legal?

Apparently these questions will indicate that the criterion for awarding of government contracts after the conduct of public bidding is not clearly understood.

Criterion for Contract Award (For Goods)

Section 37.1 of 2016 IRR of R.A. 9184 clearly established the criterion for contract award. It provides:

“The BAC shall recommend to the HoPE the award of contract to the bidder with LCRB xxxxxx after the post-qualification process has been completed.” 

Lowest Calculated Responsive Bid (LCRB) Determination; Its Processes and Stages

In order for the bidder to be determined as LCRB, it has to pass through the following processes:

a) Preliminary Examination of Bids (Section 30)

The BAC shall open the first bid envelopes in public to determine each bidder’s compliance with the documents required to be submitted for eligibility and for the technical requirements, as prescribed in this IRR. For this purpose, the BAC shall check the submitted documents of each bidder against a checklist of required  documents to ascertain if they are all present, using a non-discretionary “pass/fail” criterion, as stated in the Instructions to Bidders. If a bidder submits the required document, it shall be rated “passed” for that particular requirement. In this regard, bids that fail to include any requirement or are incomplete or patently insufficient shall be considered as “failed.” Otherwise, the BAC shall rate the said first bid envelope as “passed.”(Section 30.1)

Immediately after determining compliance with the requirements in the first envelope, the BAC shall forthwith open the second bid envelope of each remaining eligible bidder whose first bid envelope was rated “passed.” The second envelope of each complying bidder shall be opened within the same day, except as provided under Section 33 of this IRR. In case any of the requirements in the second envelope of a particular bid is missing, incomplete or patently insufficient, and/or if the submitted total bid price exceeds the ABC, the BAC shall rate the bid concerned as “failed.” Only bids that are determined to contain all the bid requirements for both components shall be rated “passed” and shall immediately be considered for evaluation and comparison. (Section 30.2)

b) Detailed Evaluation (Section 32.2.1)

The BAC shall immediately conduct a detailed evaluation of all bids using non-discretionary criteria in considering the following:

a) Completeness of the bid. Unless the Instructions to Bidders specifically allow partial bids, bids not addressing or providing all of the required items in the Bidding Documents including, where applicable, bill of quantities, shall be considered non-responsive and, thus, automatically disqualified. xxxx

b) Arithmetical corrections. Consider computational errors and omissions to enable proper comparison of all eligible bids. It may also consider bid modifications if expressly allowed in the Bidding Docum32.2.ents. Any adjustment shall be calculated in monetary terms to determine the calculated prices.

Ranking of Bids (Section 32.2.4)

Bids shall then be ranked in the ascending order of their total calculated bid prices, as evaluated and corrected for computational errors, and other bid modifications, to identify the Lowest Calculated Bid. Total calculated bid prices, as evaluated and corrected for computational errors, and other bid modifications, which exceed the ABC shall be disqualified.

The Post-qualification Process (Section 34)

The Lowest Calculated Bid shall undergo post-qualification in order to determine whether the bidder concerned complies with and is responsive to all the requirements and conditions as specified in the Bidding Documents

If the BAC determines that the bidder with the Lowest Calculated Bid passes all the criteria for post-qualification, it shall declare the said bid as the LCRB and recommend to the HoPE the award of contract to the said (Section 34.4)

HoPE’s Prerogative (Section 37.1.2)

Within a period not exceeding fifteen (15) calendar days from the determination by the BAC of the bidder with the LCRB, HRRB, SCRB, or SRRB, and the recommendation to award the contract, the HoPE or his duly authorized representative shall approve or disapprove the said recommendation.

In case of approval, the HoPE shall immediately issue the Notice of Award to the bidder with the LCRB, HRRB, SCRB or SRRB.
In the event of disapproval, which shall be based only on valid, reasonable, and justifiable grounds as provided for under Section 41 of this IRR, the HoPE shall notify the BAC and the bidder in writing of such decision and the grounds for it. (Section 37.1.30)

So it is clear from the authorities above-cited that a contract can only be validly awarded to a bidder who:

1st, found to have submitted and complied all the (eligibility, technical and financial) requirement as found in the Preliminary Evaluation of Bids;

2nd, submitted complete requirements prescribed in the Bidding Documents and after validation of its mathematical computation as found during the Detailed Evaluation;

3rd, found to have submitted the Lowest Calculated Bid after the ranking of all bids;

4th, passed all the criteria for post-qualification thereby becomes the LCRB;

5th, recommended by the BAC as the Lowest Calculated Responsive Bid (LCRB) and approved by the HoPE.

(Oscar M. Manuel is a freelance government marketer offering his  services  nationwide. He can be reached at www.facebook.com OMMConsulting or at his email address omcs03@yahoo.com or through his mobile number 0933 249 6612)

 

 

Management Functions Vis-A-Vis Audit Functions: Partnership or Adversarial?

The Commission’s role is to audit compliance by all government agencies with R.A. 9184 and its Implementing Rules and Regulations promulgated by the GPPB and the Department of Management. (Maria Grace M. Pulido Tan, Chairperson, Commission on Audit, as published in The Philippine Star, June 15, 2013)

Through the issuance of Audit Observation Memorandum (AOM) No.  SC-2018-13(17), the Commission on Audit called  the attention of lawyer Corazon Ferrer-Flores, deputy clerk of court and chief of the SC Finance Management and Budget Office, and lawyer Ma. Carina Cunanan, chairman of the Procurement Planning Committee that “the purchase of Sereno’s luxury car was contrary to Republic Act 9184 (Government Procurement Act) and its IRR (Implementing Rules and Regulations), because only Toyota Makati participated in the public bidding for the purchase of the vehicle.”

The AOM maintained that “Management used the detailed technical specifications of the Toyota Land Cruiser as reference to the bidding documents in the public bidding conducted for the procurement of a motor vehicle, hence contrary to Section 18, Rule VI, of the Revised Implementing Rules and Regulations of Republic Act 9184,”

Management Procurement Functions under the IRR of R.A. 9184

Under Section 7.1. “All procurement shall be within the approved budget of the Procuring Entity and should be meticulously and judiciously planned by the Procuring Entity. Consistent with government fiscal discipline measures, only those considered crucial to the efficient discharge of governmental functions shall be included in the Annual Procurement Plan (APP). For purposes of this IRR, a procurement project shall be considered crucial to the efficient discharge of governmental functions if it is required for the day-to-day operations or is in pursuit of the principal mandate of the Procuring Entity concerned.xxxx”

Section 17.2. “The specifications and other terms in the Bidding Documents shall reflect the necessary specifications required to meet the needs of the Procuring Entity in clear and unambiguous terms.”

Section 18. “Specifications for the procurement of Goods shall be based on relevant characteristics, functionality and/or performance requirements. Reference to brand names shall not be allowed except for items or parts that are compatible with the existing fleet or equipment of the same make and brand, and to maintain the performance, functionality and useful life of the equipment.”

Diligence Required 

P.D. 1445 Section 104. Records and reports required by primarily responsible officers. The head of any agency or instrumentality of the national , government or any government-owned or controlled corporation and any other self-governing board or commission of the government shall exercise the diligence of a good father of a family in supervising accountable officers under his control to prevent the incurrence of loss of government funds or property, otherwise he shall be jointly and solidarily liable with the person primarily accountable therefor. (Italics ours)

The Supreme Court maintained that: “To maintain inviolate the public trust reposed on them, public officers must exercise ordinary diligence or the diligence of a good father of a family. This means that they should observe the relevant laws and rules as well as exercise ordinary care and prudence in the disbursement of public funds.” (Al-Amanah Islamic Investment Bank of the Phils. v. Civil Service Commission, G.R. No. 100599, April 8, 1992)

Pursuant to the authorities cited, it will appear that for as long as the Procuring Entity procured goods that is required in its day-to-day operation or in pursuit of the principal mandate of its office, and it does not violate any existing law, rule or regulation, and that in performing these acts it exercised due diligence of a good father of the family, then it acted within its authority.

On the issue of the procurement of the purchase of Sereno’s luxury car, was there really a reference to a Brand Name or were the specifications only pertain to relevant characteristics, functionality and/or performance requirements, which just coincidentally turned out to be the same as of the Toyota Brand, thereby violative to Section 18 of the IRR of R.A. 9184? That is the question!

From this perspective, we can reasonably maintain that COA’s role is only to see to it that the Procuring Entity is acting within the bounds and parameters of the duly prescribed standards, and does not violate any existing laws, rules and regulations. Hence, the legislative intent is that the relationship is not adversarial, but partnership in ensuring an effective and efficient  disbursement of funds and utilization of resources of the government to bring about maximum benefits for the people.

(Oscar M. Manuel is a freelance government marketer offering his  services nationwide. He can be reached at http://www.facebook.com OMMConsulting or at his email address omcs03@yahoo.com or through his mobile number 0933 249 6612)

 

 

 

 

Technical Specifications, Terms and Conditions: Vital Components of a Successful Procurement Project

The ultimate success of a procurement project will be determined if it achieved the purpose for which it was intended.

Senator Grace Poe, through Senate Resolution No. 777 asked the Senate committees on accountability of public officers and investigations (Blue Ribbon), and public order and dangerous drugs to investigate the possible misfeasance, malfeasance and nonfeasance in the procurement of P1.8 billion police patrol vehicles.

In her resolution filed on July 3, the senator cited the recent COA report that found the purchase of 2,054 units of India-made Mahindra Enforcer and Mahindra Scorpio  was riddled with a number of irregularities from the crafting of terms of reference of the bidding process to the quality of the units procured.

The procurement was done in two tranches.

The first in March 2015 by the PNP through the Procurement Service of the Department of Budget Management (PS-DBM), purchasing P1.54-billion 1,656 Mahindra Enforcers—patrol vehicles intended for police stations nationwide.

The second was done in December 2015 by the PNP on its own, buying P349-million 398 Mahindra Scorpios—SUVs intended for ranking PNP officers.

The COA reported that from the interviews of police officers using the Mahindra vehicles it was found out that 57.20 percent or more than half were unsatisfied with its overall performance.

As gathered by the COA, the complaints were high fuel consumption, frequent breakdown, poor after sales services and a limited availability of spare parts that “impacted on its vision of a more capable, effective and credible police force.”

COA maintained that the problem was due to the failure of PNP to conduct an “operational needs assessment” before buying the vehicles.

The Philippine National Police denied that it committed lapses in the procurement by maintaining that from the bidding process until its procurement was not done by the Bids and Awards Committee by the Philippine National Police but by the procurement service of the Department of Budget and Management. It further stated that “the only thing that we’ve contributed is to set the specification based on the operational needs assessment that were conducted earlier,”

As I look at it, the PNP’s police patrol vehicle procurement debacle was not a question of “how” it was bought, but more of “what” was bought. The performance of the goods after it was procured is primarily determined by its specifications.

Are there guides for the preparation of technical specifications?

Technical Specification and its Considerations

Under IRR ur of R.A. 9184

Section 18 provides that “Specifications for the procurement of Goods shall be based on relevant characteristics, functionality and/performance requirements.xxxxx”

GPPB Manual of Procedures for Procurement of Goods Definition and its Considerations

The term “technical specifications” refers to the physical description of the goods or services, as well as the Procuring Entity’s requirements in terms of the functional, performance, environmental interface and design standard requirements to be met by the goods to be manufactured or supplied, or the services to be rendered. The technical specifications must include the testing parameters for goods, when such testing is required in the contract.

“Functional description” is the description of the functions for which the Goods are to be utilized. For example, a ballpen is expected to write 1.5 km of straight, continuous lines.

“Performance description” refers to the manner that the Goods are required to perform the
functions expected of them. For example, a ballpen that writes at 1.5km should do so
continuously and smoothly, without skipping, and with the color of the ink being consistent.

“Environmental interface” refers to the environment in which the required functions are performed at the desired level. For example, a ballpen should write continuously for 1.5km on pad paper or bond paper, but not necessarily on wood or on a white board.

“Design” refers to the technical design or drawing of the goods being procured. A design standard is particularly useful in cases where the goods procured are specially manufactured for the Procuring Entity. For example, in procuring BDA for the PA, there is a specific pattern of color and shade that the BDA should follow.”

“In determining the technical specifications of the goods it will procure, the PMO or end-user unit must consider the objectives of the project or the procurement at hand, and identify the standards that should be met by the goods in terms of function, performance, environmental interface and/or design. It must also conduct a market survey that will include a study of the available products or services, industry developments or standards, product or service standards specified by the authorized government entity like the Bureau of Product Standards, ISO9000 or similar local or international bodies. As a rule, Philippine standards, as specified by the Bureau of Product Standards, must be followed. For products where there are no specified Philippine standards, the standards of the country of origin or other international body may be considered.”

Philippine Bidding Documents, 4th Edition, Section VII, Technical Specification (Notes for Preparing Technical Specifications)

“A set of precise and clear specifications is a prerequisite for Bidders to respond realistically and competitively to the requirements of the Procuring Entity without qualifying their bids.  In the context of Competitive Bidding, the specifications (e.g. production/delivery schedule, manpower requirements, and after-sale service/parts) must be prepared to permit the widest possible competition and, at the same time, present a clear statement of the required standards of workmanship, materials, and performance of the goods and services to be procured.” (Italics ours)

I could assert with reasonable confidence that if the preparation of the technical specifications of the procured police patrol vehicles applied the guides duly issued for the guidance of government procurement officials, then this debacle could have been prevented, and millions of taxpayers’ money could not have been wasted.

(Oscar M. Manuel is a freelance government marketer offering his  services nationwide. He can be reached at http://www.facebook.com OMMConsulting or at his email address omcs03@yahoo.com or through his mobile number 0933 249 6612)