(Part 1 of 2)

Money out of school building projects? Bidding for the construction of public school buildings, like this one, is a lucrative source of kickbacks for several DepEd Division officials in Taguig City, alleges an informant. JES AZNAR (www.jesaznar.com)

The Philippine Government Electronic Procurement System (PhilGEPS), the country’s online procurement portal that is widely touted and cited as a model for other countries to follow, has apparently failed to protect the bidding process from corruption within the Department of Education (DepEd) and other public agencies in Taguig City.

A ‘whistleblower’ and rank-and-file employee of DepEd in Taguig City says that she was part of an illegal consortium that fixed contracts and that the Bids and Awards Committee (BAC) members of the local government’s procurement department, along with several local DepEd officials have been in collusion with favored contractors in the construction of school buildings in exchange for large kickbacks.

She claims that far from being short of money, the DepEd is awash with public funds –but they are being lost to well-organized corruption.

Employees in a constitutionally-mandated agency established to monitor and check on departmental spending are also said to be involved.

DepEd officials in Taguig are counter-charging that the informant has actually been extorting money from contractors and blackening the reputation of colleagues through her claims.

The claimed irregularities reportedly involved cancelling an invitation to bid for a PhP 32 million (USD 744,186) school building project that was only momentarily posted on the PhilGEPS site and later awarded it to a pre-selected group -- and another building project worth PhP 9 million (USD 209,302) awarded without the proper tender process as demanded by the Government Procurement Reform Act (GPRA or Republic Act 9184).

Contracts have also said to have been given to a series of front companies which had different names yet all belonged to the same construction firm said to be linked with senior politicians in this city that is fast becoming known as the new business district second only to Makati. 

The low-ranking employee of DepEd Taguig who was nevertheless part of the BAC secretariat, made the detailed allegations to the Philippine Public Transparency Reporting Project (PPTRP). She requested anonymity and claimed threats have been made to her family.

PPTRP was first alerted to claims of corruption several months ago by sources in Taguig, but it was several weeks before the key informant was finally persuaded to meet and detail the allegations.

The informant who provided PPTRP with a list of names and positions of those she says were part of the illegal consortium, claims she fell foul of the group after her role and her slice of profits started to grow and threatened the financial interests of some others involved.

She says she was first transferred to the cashier’s office within the DepEd Division Office in Taguig and then subsequently transferred to a school also within the city before she and her husband were forced to move house after several people came to her neighborhood and started asking about her whereabouts. 

Each of those involved in fixing the contracts is alleged to have received a ‘standard’ two percent share of the relevant project’s total cost: In the PhP 32 million school buildings construction project, each would thus have received PhP 640,000 (USD 14,883). 

The informant says the group operated with senior political involvement and that of an official from a different agency whose job it is to independently monitor spending was also involved.

PPTRP is passing the names of all those said to be involved, to the Office of the Ombudsman. In the interests of fairness, PPTRP is keeping confidential the names of all those provided until they provide responses to the allegations.

PhilGEPS and the reality

Around PhP 121 billion (USD 2.8 billion) worth of government infrastructure, equipment, materials, supplies and services pass through procurement yearly in order for its agencies to operate, accounting for about 15 per cent of the country’s annual government budget, according to the World Bank. With the passage of the GPRA, PhilGEPS was put in place and strengthened in an attempt to promote transparency and lessen corruption in the public procurement process.

The eight-year-old GPRA now requires all national government agencies, government-owned and controlled corporations, government financial institutions, state universities and colleges as well as local government units to use PhilGEPS as the internet infrastructure for procurement processing and monitoring. Contractors, manufacturers, suppliers and consultants are also required to register with the system. 

PPTRP met with the head of the Government Procurement Service last year as a visiting government delegation from Indonesia arrived in Manila to study the PhilGEPS system.  Other countries including Vietnam, Nepal and Uganda have reportedly been studying the system with views to replicating it at home.

With online information on bid opportunities available, contractors are now said to access bid opportunities any time of the day; download electronic bid documents; receive automatic notification through email of bid postings and supplements; and have access to government bid projects any time. 

“Information on changes in terms of references, bid schedules and on the winning bidder and contract amount are all accessible…In addition, the electronic catalogue, which provides information on pre-approved cost of commonly used items, will help government auditors check that supplies purchased by a government agency are not grossly over-priced,” So says the PhilGEPS website. To date, it is being used as an electronic billboard; suppliers’ registry; electronic catalogue; automatic bid notification; and virtual store. 

And yet for the PPTRP informant, PhilGEPS has been easy to manipulate because of lack of checks and balances. As part of the BAC secretariat, the informant was the only one with the passwords to access the DepEd Taguig Division’s PhilGEPS account. In 2008 she was put in charge of preparing bid document requirements, and receiving bid documents from competing contractors and posting the required materials on the PhilGEPS site. 

“PhilGEPS served as mere catalogue of invitations to bid. Beyond that, it was up to the DepEd Division how the bidding would go and end,” the informant told PPTRP. 

The invitation to bid for the construction of school buildings with approved budgetary ceiling (ABC) of PhP 32 million (exactly P32,732,800), for instance, was posted on July 8, 2010 but cancelled a few hours later – allegedly on orders of her superiors, the informant said. 

She also said that despite the cancellation, contracts were agreed on August 10, 2010 with four named contractors given a total of nine contracts.  And while the contractors are from different companies, the names of those individuals submitting the bid papers were all the same, according to the informant. 

The whole bid process and the execution of contracts must also be declared null and void in the first place because the invitation to bid was cancelled, the informant maintains. 

Another project, the construction of the Simplicio Manalo High School worth PhP 9.7 million (USD 225,581), was also reportedly posted at the PhilGEPS system only with the status of “in preparation” but a contract was later executed and awarded to one of the winners of the earlier contract on February 9 of this year. The invitation to bid was published in Saksi, a newspaper circulating only in Metro Manila, thus indicating a violation of GPRA requiring that invitation to bid for projects above PhP 2 million must be published at least once in a newspaper of general nationwide circulation. 

Non-posting at the PhilGEPS also happened to a project for the construction of school comfort rooms worth PhP 3,168,990 (USD 73,697). The informant said that the project, with Reference Number 1391858 at PhilGEPS, was never activated but posted only with “in preparation” status.

Kickbacks?

When pressed about whether she herself benefited from the alleged activities, the informant admitted: “I received money a few times. I told myself: ‘My superiors were doing these acts so how could I not do the same?’ ” 

The informant admitted receiving PhP 50,000 (USD 1,162) for “helping” to facilitate bid documents in the PhP 32 million construction project, and another PhP 100,000 (USD 2,325) for doing the same regarding the construction of the Simplicio Manalo High School. 

As an appointed member of the BAC secretariat, the informant has been in charge of duties including publication of invitations to bid in different broadsheets; posting of invitation to bids at the PhilGEPS site; reproduction of technical specifications such as floor plans; printing and preparation of bid documents; receipt of letters to bid; and assistance in technical presentations during the pre-bid and opening of bids.

Since she began to get involved in the work at the BAC in the division in 2008, the informant said she got to know the standard system of bribes in the division. Selected officials including those assigned to check on spending were each given two percent share of the total project cost. Senior political backers allegedly received 20 percent of the total cost. 

“Kaya hindi totoong walang pera ang DepEd. Marami itong pera, napupunta lang kung saan-saan at sa korapsyon (It’s not true that DepEd is cash-strapped. It has lots of funds which are only lost to corruption),” the informant told PPTRP. 

The informant said she began to fall foul of her superiors at DepEd Taguig when plans of including her in the two percent sharing scheme surfaced, with the contractor allegedly saying “Kami na ang bahala sa kanya” (We would take care of her) in a meeting on how to rig the bidding process of a new project for school buildings worth PhP 89 million in February of this year. She stood to make up to PhP 1.78 million (USD 41,395) from her cut of the deal. But others reportedly got concerned about the amounts that would be going to her, she said.  

The informant at first received warnings about her tardiness and then was later reassigned to another position within the division on February 23. The informant said she threatened to expose what she knew about the bidding process irregularities in the division when her superior warned her that she would be transferred to another post outside the Division office.

On March 1, the informant received another memo ordering her transfer to the Taguig National High School. She also claimed that on March 8, she was finally barred from entering again the Division Office and was also accused of extorting money from contractors – an allegation which she denies. Several flyers carrying her photo and a warning message that she has been in extortion have been posted in different parts of the DepEd Division office, the informant said. 

“This is what my mother-in-law was telling me for a long time. She said I may be enjoying quick and easy money, but until when? I was warned that sooner, I would be pulled down and falsely accused of wrong doing,” she said in Filipino. 

The informant said that even without the dispute between her and her superiors linked to her tardiness, she would have still come out to tell the truth because her conscience could no longer take the point that she was aiding in an alleged corrupt practice. “And the money that goes to pockets of corrupt officials means lesser and lesser quality of school buildings and thus risks for students and teachers.” 

To date, the informant and her husband had left Taguig and transferred to another city for fear of reprisal from her DepEd superiors, whom she said are well-connected. Her husband also had to close his computer shop and sacrifice their source of income. 

The DepEd National Capital Region Office recently denied the informant’s petition to stay, arguing that it is the discretion of the DepEd Division Head to let her stay in her post or otherwise. She has elevated her appeal to the DepEd Central Office. 

She is also awaiting decision of the DepEd Central on her complaint of ‘oppression’ against her superiors following her transfer to two different posts within two weeks.

The informant filed a complaint on Graft and Corruption and Violation of Procurement Act against erring DepEd Division officials before the Ombudsman on May 16.

“I just want the job which I cared for over 10 years back. I also want my dignity. I really want to correct what is wrong,” she said. Philippine Public Transparency Reporting Project

Next: Part 2: DepEd execs’ counter-allegations and Facebook wars

(The author is the project manager of the Philippine Public Transparency Reporting Project.)