OGCC spending too much for photocopying expenses - COA

MANILA, Philippines - The Office of the Government Corporate Counsel (OGCC), the agency tasked to safeguard the legal interest of all government-owned and controlled corporations (GOCCs) in the country, appears to be spending a lot of money for photocopying expenses, according to government auditors.

Records show that in 2010, the OGCC paid the private firm UBIX Corp. a total of P528,744.58 for the reproduction of various documents, or nine percent higher than the contract price of P486,000.

And in 2011, OGCC’s photocopying expenses went up even higher based on how it paid a whopping P461,677.97 for the first seven months of the year alone.

The Commission on Audit (COA) is questioning the UBIX Corp. contract and the non-monitoring of the actual operations of the machines being used by the supplier.

“The monitoring of photocopied documents per machine would help determine whether the agency is still lacking or exceeding the required number of documents being copied and paid per month,” an audit report released yesterday said.

“Monitoring tools for said purpose by the agency is necessary in order to avoid potential increases in payment to be made on the availed monthly services which can cause budget deficit on the part of the agency,” state auditors stressed.

The COA report said the May 2009 UBIX Corp. deal for the rental of four photocopying machines was not even subjected to public bidding, thus defeating the principle of competitiveness and preventing the government from getting the most advantageous rental costs.

After the expiration of the contract in May 2010, state auditors said the photocopying services of the private company continued to April 13, 2011 with payments made without the approval of the head of the agency.

Sometime in April 2011, the COA report said the supplier increased the rate per copy by 34 percent or equivalent to P11,961.94 and was paid also by the OGCC without proper justification and approval.

On June 14, 2011, the Bidding and Awards Committee (BAC) issued a Resolution allowing UBIX Corp. to continue providing the photocopying machine units and services needed pending procurement of a new photocopying service provider by the agency.

State auditors said the BAC “has no authority to allow the supplier to continue its services after the expiration of the contract since extension of contract is not a mode of procurement.”

In October 2011, the OGCC’s accountant, in an effort to reduce the rates, negotiated with the supplier and as a result, the rates was decreased by .09 percent, which was a small percentage compared to the increase previously made by the supplier.

State auditors said the absence of public bidding for the contract deprived the agency the opportunity to have comparable prices to choose from and obtain the most advantageous rental cost.

The COA report also cited loss of opportunity to avail of the use of upgraded or state of the art photocopying machine, which can be provided by other prospective bidders considering that what was being used in 2009 are the same machines being used now.

In defense, officials explained that monthly payment of lease after the expiration of the contract was resorted to in order not to disrupt operations.

“Government’s interest is still protected and our Office’s core functions are not derailed when this was resorted to. The Office is now adopting remedial measures to confront its photocopying needs,” OGCC said.

State auditors, in response, maintained however that the conduct of public bidding “is a mandatory requirement of the law on all procurement activities of the government.”

“The budget for the contract was never an issue. The mere fact that the agency continues to pay the current photocopying service provider shows the availability of the funds,” the COA report said.