COA: Fast-tracking of OVP’s SAT units led to disregarding procurement rules

Vice President Sara Duterte honors the Office of the Vice President’s public and private sector partners on Monday, June 5, 2023. (File photo from her Facebook page)

MANILA, Philippines — The Office of the Vice President (OVP) failed to fully observe provisions in Government Procurement Reform Act when it immediately established Satellite Offices (SOs) across the country, the Commission on Audit (COA) stated.

COA’s annual audit report of OVP for 2022 showed when the office purchased its Plant, Property, and Equipment (PPE) and semi-expandable equipment in their SOs worth P668,197, the funds used came from its officers — who the government eventually reimbursed.

However, even if a quotation was provided to obtain the lowest price, COA said it still did not adhere to Republic Act Number 9184’s goal of improving transparency.

“Our audit disclosed that OVP failed to fully observe the processes and procedures required under RA no. 9184 and its IRR in the purchase of its PPE and Semi-Expendable Equipment in SOs totaling P668,197.20,” the report said.

“The immediate establishment of SOs without enough equipment to operate led to Management’s decision to resort to the immediate purchase of PPE and semi-expendable property using the cash of its officers, which the OVP subsequently paid through reimbursement,” the commission recalled.

“Although a quotation was attached, ensuring that the lowest price was obtained in the market, OVP’s failure to undergo these purchases in processes and procedures required under RA no. 9184 and its IRR defeats the purpose of the Procurement Law, which is to standardize and to improve transparency in the procurement process,” it observed.

COA also noticed the receipts were reported only to the Property Unit between one to three months after the purchase, thus raising questions on accountability.

“In addition, the Audit Team also noted, based on control reference of Inspections and Acceptance Report (IAR) and date of Inventory Custodian Slip (ICS) and Property Acknowledgment Receipt (PAR), that purchases were reported only to Property Unit one to three months after its purchase. Hence, accountability over the property was not immediately established,” COA explained.

When they asked why OVP resorted to using its officers’ personal funds, the office answered it wanted to expand the services provided by OVP immediately.

“As per inquiry, the immediate establishment of SOs was made due to Management’s intention to immediately expand services offered by OVP to various provinces, however, controls to ensure that government resources were utilized as intended and prevented from loss should also be considered,” COA relayed.

“The immediate establishment of OVP’s SOs without a standardized and streamlined process in handling and reporting of acquired PPE resulted in late reporting and recording of purchased property,” it added.

It could be remembered that one of the first projects of Vice President Sara Duterte was to expand OVP’s reach, by establishing satellite offices where people seeking help, but are from far-flung areas, can apply for aid.

As early as July 3, 2022, OVP opened up six satellite offices in Dagupan, Cebu, Tacloban, Zamboanga, Davao, and Tandag.

COA said it has asked OVP to stop doing transactions that eventually lead to reimbursement as it defeats the purpose of the procurement reform law.

It added such programs must be carefully planned.

In response to COA, OVP admitted it went on this route because of time constraints provided by law.

“We acknowledge that some of the purchases made for our SOs were [made] through reimbursement,” it stated.

“Due to the time constraints imposed by RA No. 9184, the Procurement Unit was unable to process requests at the time of opening of the SOs on July 1, 2022,” the office explained.

“The Property Unit, on the other hand, does not have the necessary office equipment at the time of the opening,” it said, OVP as stated by COA.

“Nonetheless, the SO staff exercised the necessary diligence to ensure that the items purchased are of the required quality and at the lowest price offered in the market,” OVP elaborated.

“Moving forward, all transactions pertaining to procurement of PPE and Semi-Expendable Property for SOs will be processed following the guidelines under RA No. 9184 accordingly,” the office told the commission.

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