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3 firms on DBM blacklist got P727M in PPE, other deals as gov’t purchase rules eased for pandemic

By: - Reporter / @bendeveraINQ
/ 08:25 PM September 02, 2020

MANILA, Philippines—At least three companies on the Department of Budget and Management (DBM) blacklist secured P727 million in deals to supply personal protective equipment (PPE) as the government eased rules in buying goods at the height of COVID-19 lockdowns in a bid to speed up response to the health crisis.

The Government Procurement Policy Board (GPPB), an office under the DBM, earlier extended to Aug. 31 the deadline for all procuring agencies, including national government agencies and their regional offices and local government units, to post online contracts awarded through emergency procurement rules under the Bayanihan to Heal As One Act, which was in effect from March to June.

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The Bayanihan law had allowed negotiated deals to expedite the purchase of essential goods “with clear and simple rules on liquidation.” It was “a liberal procedure in determining the price most advantageous to the government considering the urgency of the present situation.”

The relaxed procurement rules were also “measures to reasonably prevent abuses and corruption but not too restrictive as to delay the process,” the GPPB said in a resolution last April.

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A check on the GPPB website last Sept. 1—one day after the deadline for contract posting—showed a microsite (https://gppbgovph.com/awardedcontracts.php) for awarded contracts during the period when the Bayanihan law was in effect.

The GPPB had also been maintaining a separate microsite (https://www.gppb.gov.ph/ConsolidatedBlacklistingReport.php) containing a list of blacklisted entities which the procurement board had flagged for “offenses or violations committed during competitive bidding and contract implementation” in violation of RA No. 9184, or the Government Procurement Reform Act.

When the Inquirer checked if any of the 67 entities on the GPPB blacklist landed contracts during the emergency procurement period, it found at least three — Ferjan Health Link Enterprises, Cebu Business Materials Trading Co. Inc. and Jozeth Trading.

Sought to comment, Assistant Budget Secretary Rolando Toledo, also DBM spokesperson, told the Inquirer that blacklisted entities were “not allowed from participating in any of the bidding activities of the government for the period of blacklisting.”

Even when emergency procurement was implemented, the blacklisting rule “applied to all bidding acts of the government, including under Bayanihan One,” Toledo said.

Asked if contracts with blacklisted entities can still be revoked if already awarded, Toledo replied: “It would be good to know the grounds for blacklisting, if that can be used to terminate the contract.”

Can procuring entities also be penalized? Toledo said the agencies may face an administrative or criminal case, depending on the reason they awarded the contract to a blacklisted entity.

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In the case of Ferjan Healthlink Enterprises, located in Muntinlupa City, the GPPB said it was blacklisted for a two-year period effective Sept. 25, 2018 until Sept. 26, 2020 due to “non-fulfillment of delivery of supplies for drugs and medicines” to the local government of Zamboanga City.

However, a check with the Food and Drugs Administration (FDA) website showed that it shared the same Putatan, Muntinlupa City address as the corporate office of Ferjan Healthlink Philippines Inc., which snagged five contracts during the implementation of emergency procurement.

On May 29, the local government of Ivisan, Capiz, awarded to “Ferjan Healthlink Enterprises”, supposedly located in “Putatan, Mandaluyong, Manila”, a contract to deliver various medicines, medical, dental, rapid test kits and laboratory supplies, documents showed. There was no Barangay Putatan neither in Mandaluyong City nor in the City of Manila.

The notice of award, signed by municipal mayor Felipe Neri Yap, showed a breakdown of costs amounting to a total of P1.47 million, but the separate purchase order amounted to P470,651 only. In the GPPB website, the indicated amount awarded was merely P286.540.

Four other contracts were awarded to a “Ferjan Healthlink Philippines” — P37,150 for PPEs, P171,000 for vitamins to be distributed to senior citizens, and P335,000 for surgical disposable face masks and cadaver masks procured by the local government of Oton, Iloilo, all in May.

The biggest contract snagged by a “Ferjan Healthlink Philippines Inc.” was P727.5 million — for supply and delivery of 500,000 sets of PPEs priced at P1,455 each, by no less than the DBM’s PS, documents showed.

In the June 19 notice of award and contract agreement signed by Budget Undersecretary Lloyd Christopher A. Lao, who is also the PS’s officer-in-charge and executive director, Ferjan Healthlink Philippines Inc. was tasked with delivering the PPE sets—composed of shoe cover, sterile gloves, apron, clean gloves, coverall, head cover, and gown—to the AFP LOGCOM Warehouse in Camp Aguinaldo, Quezon City within 45 calendar days upon issuance of purchase order, which came on June 23.

The Inquirer sent a text message to Lao inquiring about this contract, asking if the blacklisted “Ferjan Health Link Enterprises” was different or the same as the “Ferjan Healthlink Philippines Inc.” with which the PS made the deal, but Lao did not reply as of Wednesday night.

Another blacklisted entity, Cebu City-based Cebu Business Materials Trading Co. Inc. snagged seven contracts in the Central Visayas region:

  • P22,200 for PPEs and P74,720 for thermal scanners for the Department of Labor and Employment’s (DOLE) regional office in March
  • P2,800 in cleaning supplies for the Department of the Interior and Local Government’s (DILG) regional office in May
  • P130,000 for infrared thermal scanners
  • P218,000 for alcohol and disposable face/surgical masks
  • P194,100 for surgical/disposable masks and disposable latex gloves for the Department of Social Welfare and Development’s (DSWD) regional office in April and May
  • P472,500 in body bags for the Vicente Sotto Memorial Medical Center in June.

Cebu Business Materials Trading Co. Inc. was blacklisted by the GPPB from Dec. 18, 2019 to Dec. 18, 2020 due to “non-completion of delivery amounting to P3,051,078.75 or 83.79 percent of the contract” to the Bureau of Jail Management and Penology’s (BJMP) National Capital Region office for inmates’ yellow T-shirts.

Jozeth Trading, GPPB records showed, was awarded two contracts—P194,000 and P452,750 for paracetamol tablets and surgical gloves as well as “various supplies and medicine for use in the prevention and management of a COVID-19 outbreak,” in the local government of Santa Cruz, Laguna.

Jozeth Trading was blacklisted for one year—from Oct. 15, 2019 to Oct. 14, 2020—as a result of “termination of the contract due to the default of the bidder/supplier” when it dealt with the Department of Education’s (DepEd) Central Luzon regional office for teachers and students’ table-and-chair sets, the GPPB said.

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TAGS: #COVID19PH, Blacklist, contracts, coronavirus Philippines, corruption, DBM, PPEs, procurement, Supply
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