COA: ‘Yolanda’ projects split to favor 1 builder

The Commission on Audit (COA) has found irregular the award of P654.6 million worth of housing projects for people displaced by Supertyphoon “Yolanda” to a contractor whose license did not authorize it to take on such big-ticket projects.

In its 2017 annual audit report, the COA urged the National Housing Authority (NHA) to sue its erring officials and the still unnamed contractor of eight housing projects in the towns of Balangiga, Hernani and Quinapondan in Eastern Samar.

Auditors found that adjacent projects in the three sites were split into eight smaller contracts to “accommodate” the developer, whose Philippine Contractors Accreditation Board license authorized it to secure construction deals worth only as much as P100 million.

Beyond limit

Had the contracts not been split, the total cost would have been P133.2 million for Balangiga, P286.6 million for Hernani and P234.7 million for Quinapondan.

For the COA, this meant the contractor exceeded its P100-million limit.

The COA said the NHA violated the Government Procurement Reform Act.

It also found that 10 Yolanda Permanent Housing Program projects, worth P852.7 million, progressed very slowly because the NHA awarded contracts to a developer that had few workers and equipment.

The contractor—also not named in the report—ended up delaying the project.

The status reports also showed that the contractor’s deadline was extended 33 times, or a total of 2,761 days.

Despite this, the projects were not finished.

The COA said this was ground for termination of the contract.

The NHA did so for nine of the 10 contracts on Nov. 15, 2017.

No damage payment

But auditors questioned the NHA’s failure to collect damage payment from the contractor as penalty.

The NHA, in its response to the COA, admitted that the sufficiency of the contractor’s manpower and equipment was “not fully monitored.”

It said it discovered the problems only after the issuance of site memorandum reports that directed an increase in deployment of workers.

But it added that it had been stricter in enforcing the manpower and equipment requirements as well as requests for extension of deadlines.