Diokno: Let’s not distract ourselves from real issues on Nayong Pilipino

Budget Secretary Benjamin Diokno.
INQUIRER PHOTO / EARVIN PERIAS

“We should not distract ourselves from the main issue here.”

Budget Secretary Benjamin Diokno said this after former Office of the Government Corporate Counsel (OGCC) Rudolf Jurado claimed that he, together with Finance Secretary Carlos Dominguez, in January 2018 revoked the bidding requirement for Nayong Pilipino’s lease contract with a Hong Kong developer.

“Ultimately, it is the GOCC [government-owned and -controlled corporation] governing board that has full responsibility and accountability for its decisions,” Diokno said in a statement on Tuesday.

The controversy stemmed from the contract review by the OGCC where Jurado cited Governance Commission for GOCCs (GCG) Memorandum Circular (MC) No. 2018-02 as the basis for allowing Nayong Pilipino to lease the land even without public bidding.

Diokono, however, said “a review of the facts and law on the matter contradicts Jurado’s position.”

“In fact, an investigation by the Department of Justice (DOJ) has concluded that the NPFI [Nayong Pilipino Foundation Inc.] lease contract with Landing Resorts Philippines Development Corporation (LRPDC) is void ab initio or has no legal effect from the beginning,” he said.

Citing the DOJ report, Diokno noted that “the contract is a build-operate-transfer (BOT) contract disguised as a lease contract, the implication of which is that the same should comply with the BOT law, which includes public bidding.”

Diokno added that “even if the proposed Major Development Projects and Contracts of GOCCs lie within the sound business judgment of the respective governing boards of the GOCCs, they are still mandated by existing laws, rules, and regulations to exercise extraordinary diligence in the conduct of business and in dealing with the properties of their respective GOCCs.”

READ: DOJ finding: Nayong Pilipino deal with HK firm ‘void from the start’

“In fact, the Governing Boards of GOCCs are constituted under Republic Act No. 10149, or the GOCC Governance Act of 2011, as ‘fiduciaries of the State,’ with the ‘legal obligation and duty to always act in the best interest of the GOCC, with utmost good faith’ and who “must exercise extraordinary diligence of a very cautious person with due regard for all the circumstances,” the Budget chief said.

Moreover, GOCCs are required to secure a favorable legal opinion/contract review by the OGCC before entering into the said agreements and not merely rely on GCG MC No. 2018-02, Diokno claimed.

“As such, there is no such blame to be shifted in this instance; the NPFI Board and OGCC have the last say on the matter,” he added.

The President has called the deal “anomalous” because it did not go through public bidding. This also prompted Duterte to sack the entire Nayong Pilipino board. /jpv