COA: Pinamungajan project lacks contract; funds wasted

CEBU, Philippines - A project to improve street lighting along the coastal road in Pinamungajan town amounting close to P6.9 million was not covered by a contract, said the Commission on Audit in a recent audit report.

The project was awarded to BNR Construction and Development Corporation but no contract was allegedly entered into between the municipality and the construction firm.

COA said the absence of a formal contract violates Article XI of Republic Act 9184, which provides that “within the (10) calendar days from receipt of the Notice of Award, the winning bidder shall formally enter into contract with the Procuring Entity.”

COA said a contract is necessary “to specify the scope of works and terms and conditions relative to the implementation of the project.”

Pinamungahan Mayor Geraldine Yapha reasoned that the Bids and Awards Committee “has been using only the Form of Agreement,” which can be found in the Guide on the Procurement of Works, Philippine Bidding Documents.

Yapha, however, assured that the town will strictly implement the execution of a contract embedded in the laws, rules and regulation in the implementation of the project.

COA recommended that the municipal government should observe the existing laws and regulation in the implementation of projects, particularly the execution of contract.

  Meanwhile, COA also found out that the town has incurred “unnecessary expenses” amounting to P154,000 covering the registration fees and travel expenses of town officials and employees who attended a three-day executive forum at the Cebu Business Hotel in Cebu City on January 18-20, 2008.

COA said the forum “was unnecessary and not essential to the needs of the public and can be dispensed without loss or damage to property.”

COA also pointed out that it was ironic why most of those that attended the forum were from the legislative department when the event was executive in nature.

  Yapha explained it was “in line with the thrust of the municipality to update and be informed of the new and innovative ways to coordinate and deliver basic, regular and direct services as well as effective governance of the constituents of Pinamungajan.”

  While it was true that the meeting was called an “executive forum,” Yapha said an invitation was sent to all town officials and employees, and not solely to the executive department.

  However, COA argued “it is not a guarantee that it would result in the effective administration of the local government.”

  “Such expenditure is not essential and could be dispensed with without loss or damaged to property. The municipality could have saved government funds if only one or two participants were sent to attend said forum. These participants may conduct an echo seminar for the rest of the employees in the municipality,” COA said. — Garry B. Lao/JMO