Lampposts anomaly set a benchmark in State corruption

People should not forget about this case,” said Deputy Ombudsman for Visayas Pelagio Apostol, referring to the grossly overpriced lampposts that the government purchased in 2006 as part of the Philippines’ hosting of the 12th Association of Southeast Asian Nations (Asean) Summit.

Apostol was commenting on the decision of the Sandiganbayan dismissing a complaint filed against former Lapulapu City mayor and now lone district Rep. Arturo Radaza and 12 other officials in relation to the overpriced decorative lampposts.

In a decision dated Jan. 17, 2013, the court cited the “failure” of the prosecution to submit enough evidence to prove the officials violated the Anti-Graft and Corrupt Practices Act by entering into contracts grossly disadvantageous to the government.

Apostol, who filed multiple cases against Radaza et al on the lampposts transaction, is faulting the Manila Special Prosecutor’s office for the adverse ruling. There have been reports that four of seven cases filed by the Visayas Ombudsman were sent back allegedly with specific orders for the anti-graft office to reinvestigate the case.

I have yet to hear the reactions of former Visayas Ombudsman executive director Virginia Palanca-Santiago over the legal setback. She initiated the fact-finding investigation on the lampposts scandal in 2007 and knowing her dedication, I don’t think she led a sloppy probe which resulted in the filing of weak cases before the anti-graft court.

Congressman Radaza, not surprisingly, rode the Sandigayanbayan ruling by interpreting it as vindication on his part. He said the dismissal of the case proved he had no hand in the implementation of the project because it was a national government undertaking.

Radaza must think people are stupid or would carelessly set aside the context of the anomaly when it broke out in early 2007.

At the time, the conspiracy or collusion angle between local government officials and high ranking executives of the Department of Public Works and Highways (DPWH) was a hot topic and provided the only coherent reason why the local government units would submit a grossly overpriced project and the implementing agency confirm it almost without thinking.

In a March 08, 2007 article, I offered my two cents on why local government officials like Radaza and then Mandaue City Mayor now Provincial Board member Thaddeo Ouano are in hot water over the lampposts scandal.

“For someone who has been exposed to cases of malfeasance committed by government officials, Ombudsman director for the Visayas Virginia Palanca-Santiago must have been unmoved when businessman Crisologo Saavedra and cause oriented groups filed a complaint asking the anti-graft body to look into the alleged overpricing of decorative lamps used for the 12th Asean Summit.

“After all, the Ombudsman executive has been at the helm of the office charged with stamping out government corruption for many years and she maybe jaded about dealing with another pangurakot case.

“But on the summit lamps issue, specifically on the purchase by Mandaue City of 124 decorative lamps for P27 million, a very stunned Director Virgie reportedly exclaimed, ‘Hesus, Ginoo ko!’

“Mandaue and Lapulapu City officials have denied any involvement in the controversy, claiming the Department of Public Works and Highways in Manila is responsible for the purchases.”

While it is true the summit lamps were bought using national funds, it was the local government unit that defined the undertaking, meaning it was a local project.

“The local chief executives were responsible for drawing up of the Program of Work and Estimates (POWE). In the POWE, one finds the estimate set by the agency as ceiling for bids and awards. It would be hard to gloss over the role of the local government units in this case: they prepared the POWE, which guides the implementing agency, i.e., DPWH in the execution of the project.

“The P95,000 agency estimate for the cost of each decorative lamp is already grossly overpriced if one considers that the actual cost is P11,000 per unit if bought directly from a supplier in China; or P31,000 if it passes through a local contractor; or P16,000 from a source that supplied Naga town the very same decorative lamps.

“A businessman familiar with government contracts told me the agency estimate was set with suppliers, a figure that also insures the share of ‘non-agency personages’ but does not include anything for local officials, referring to kickbacks in the contract. In any case, awards seldom exceed government estimates, thus the POWE submitted by Mandaue City should show an agency estimate of more than P224,000. Otherwise, if the agency estimate remained at a ceiling of P95,000, Mandaue’s POWE will complicate the whole issue for the DWPH.

“As a rule, bids should not have a discrepancy of more than 20 percent of the POWE. If the agency estimate was pegged at P95,000 per summit lamp, bids that quoted P76,000 per unit would have better chances of winning the contract, or if the bid was lowered down to P31,000—the offer made by a local businessman—he would have gotten the deal hands down. But such is not the case because apparently, the implementing agency was not looking for cheap lamps, the standard in state procurement, but for unconscionably expensive ones.

“At P224,000.00 per set, the street borloloys were clearly unconscionably over-priced. Multiply that amount with 127 lamp fixtures including the late-discovered 150 sets and you have a whopping tag of P330,000 each on the average, or 1,000 percent mark-up which is said to have yielded kickbacks of at least P60 million.”

Clearly, a reinvestigation is in order, one that will probe into the participation of top Public Works officials, like Hermogenes Ebdane who served as DPWH Secretary from February 2005 to July 2007.

I hope President Noynoy Aquino looks into this case because the purchase of the summit lamps did set a new benchmark in state corruption.