Cristino Naguiat. AFP PHOTO
MANILA, Philippines—An ‘isolated’ case and an ‘ongoing practice’ were how the Philippine Amusement and Gaming Corporation (Pagcor) explained its procurement of more than P8-million worth of bottled mineral water last year without public bidding.
“This had been the ongoing practice since the last decade,” Pagcor said in a statement issued Wednesday, citing the reasons given by concerned casino branches during the annual audit exit briefing conducted by the Commission on Audit (COA).
In its 2011 audit report, COA discovered that Pagcor spent a total of P8.2 million worth of bottled mineral water and another P1.79 million worth of five-galloon water for its three casino branches – Pavillion, Heritage, and Paranaque— without public bidding.
But during the exit briefing, Pagcor said the concerned branches explained why they resorted to the “shopping method of procurement” of bottled mineral water and five-galloon water.
First, the procurement of bottled water, among other consumable supplies, had been previously decentralized to the branches for practicality and expediency due to their different locations since the last administration;
As a result of such decentralization, the branches were authorized to undertake their procurement activities independently of the corporate office.
“Consequently, the procurement requirements at the branch level resulted in smaller quantities which did not breach the threshold amounts provided for under the IRR of RA 9184,” the statement said.
COA, in its report, pointed out that under Section 10 of RA 9184, “All procurement shall be done through competitive bidding, except as provided for in Article XVI, which comprises the various alternative methods of procurement…”
“Although admittedly, if the quantities were consolidated Pagcor-wide, the resulting amounts would breach the above-mentioned threshold amounts,” Pagcor said.
Recognizing COA’s concern on the issue, Pagcor now being headed by chairman Cristino Naguiat immediately initiated moves to require the procurement of bottled water on a Pagcor-wide basis through public bidding.
“In view thereof, COA did not issue a Notice of Disallowance or Notice of Suspension because the audit finding and observations pertained only to operational matters, which do not involve pecuniary loss,” it said.
Also read: No sanctions on Pagcor, says Malacañang
Pagcor also noted that out of its 13 Casino Filipino branches, only three were involved in the COA findings.
“The deviation was therefore isolated,” said the state-gaming firm.
“In fact, COA has commended Pagcor’s current management for exercising fiscal responsibility particularly in the area of procurement,” it said.
Pagcor then cited COA’s own report commending the “outstanding performance” of the current management, which “resulted in achieving the revenues of P36.65 billion for the year 2011.”
“This is the highest Pagcor earnings for the past eleven (11) years, which provided more funds for the government and exemplary accomplishments of its various programs and projects,” the state-gaming firm said, quoting COA report.
“Also we commend Management for exercising the fiscal responsibility provided under paragraph 2 of Section 13 of Government Accounting and Auditing Manual (GAAM) Volume I which substantially contributed to the agency’s continuous contribution to extend much needed funds for socio-civic activities, subsidy to national government agencies, taxes and to mandated contributions to different government agencies,” COA added.