In the business of construction, licenses are supposed to be symbols of trust and accountability. In our country, the Philippine Contractors Accreditation Board (PCAB) was created precisely to make sure that only legitimate, qualified contractors can participate in this kind of business activity. Such is especially required in transactions involving government infrastructure projects. As the primary oversight body for the government, the PCAB was mandated and placed in an attached agency under the Department of Trade and Industry (DTI).
Republic Act (RA) 4566, as amended by Presidential Decree (PD) 1746, empowered the PCAB as the chief licensing agency of the government for individual contractors or entities engaged in the business of contractors. The same twin laws clearly state that no contractor – whether main, subcontractor or specialty – shall engage in business without first securing a PCAB license. So operating without it is an offense and a blatant violation of these laws.
Yet in practice, a troubling reality seems to persist through the years up to the present. This emerged in the privilege speech of and subsequent interpellations on Senator Panfilo “Ping” Lacson during last week’s sessions at the floor. Taking advantage of the inherent weaknesses of our licensing laws, Sen. Lacson presented how the 15 biggest contractors bagged almost P100 billion out of P545 billion worth of non-existing flood control projects all over the Philippines.
It was an offshoot from the State of the Nation Address (SONA) of President Ferdinand “Bongbong” Marcos Jr. (PBBM) at the joint opening session of the 20th Congress last July 28. It was seven months later when he finally exposed the details of his line-item vetoes in the 2025 General Appropriations Act (GAA) approved by the defunct 19th Congress. Supposedly implemented by the Department of Public Works and Highways (DPWH), PBBM confessed he vetoed all these congressional “initiatives, errata,” that were inserted in the 2025 budget of the DPWH and allocated in various areas of the country.
PBBM later reported the initial results of his administration’s internal investigations into the alleged “ghost” flood control projects. Then he resumed his ocular inspection visits to look for them. Doing a solo inspection, he could not locate one. But even if he found an existing flood control project, PBBM found prima facie evidence of substandard completion of the project and saw the poor quality of construction materials used as against the contract specifications and price paid for by taxpayers’ money.
PBBM had been flaunting the many flood control projects being funded under the National Expenditure Program (NEP) for the past three years. All of which were included in the annual budget of the DPWH, coinciding with the term of the members of the 19th Congress who included presidential relatives and many other lawmakers belonging also to political dynasties. Without naming names, Lacson believed 67 contractors even got themselves elected to Congress through the years.
Fortunately, Sen. Lacson doesn’t belong to any political dynasty nor has he been into the construction business. Most important of all, Lacson never accepted any pork barrel allocations in the budgets they approved during his first 12 years as a senator in the past two Congresses. Thus, Sen. Lacson has the moral ascendancy in his lonesome crusade against shenanigans in the annual budget deliberations in Congress.
In his exposé on the Senate floor, Lacson denounced his own discoveries that some PCAB licenses end up being lent, borrowed or even leased out. Instead of being strictly personal and non-transferable, contractors who never passed the stringent requirements of PCAB can worm their way into government bidding. As it turned out, these unscrupulous contractors get away with it through schemes like piggybacking on someone else’s PCAB license and accreditation.
This loophole that has now come out into the open undermines the credibility of the PCAB system.
Sadly, this loophole seriously compromises the safety and integrity of government funded projects intended to serve the public. Like a “bouncing check” that is not supported by sufficient bank deposits, a PCAB license that can be “borrowed” or given to unqualified players is no different from the crime of estafa or fraud.
It’s important to understand PCAB’s role. The Board is not part of the bidding process. It doesn’t decide who wins, who qualifies or what projects get awarded. That responsibility falls squarely on the implementing agencies and their Bids and Awards Committees (BAC), under RA 9184 or the Government Procurement Reform Act.
PCAB’s job is to accredit – to make sure that a contractor is authorized to engage in construction contracting. But accreditation is only the first step. It certifies the contractor’s legitimacy, not its guarantee of winning projects.
When contractors lend their licenses to others, they distort the system. Instead of accountability, what we get is dilution. A license that should carry the weight of financial capacity, technical expertise and track record is suddenly detached from those very qualifications.
Imagine a project awarded to a bidder who merely “borrowed” their way into the process. When things go wrong – when projects are left unfinished, substandard or mismanaged – who will be held responsible? The name on the license, or the shadow figure who actually carried out the work? This gray area is a breeding ground for corruption, ghost projects and failed infrastructure.
Today, the law treats unlicensed contracting as an offense. But what about those who lend out their licenses? What about those who knowingly enable shortcuts? These acts are just as dangerous, just as damaging and yet the penalties are often weak, if not altogether vague.
PCAB already conducts post-verification checks, reviewing a sample of over 1,000 contractors annually. But with more than 20,000 licenses in play, that’s a drop in the bucket. Stronger deterrents are needed. Stricter laws, clearer penalties and tighter monitoring must be put in place. A PCAB license is steeped with public trust; abusing it should not be tolerated.
It’s time for lawmakers and industry leaders to revisit the framework of PCAB licensing to plug these loopholes. Amend the systemic flaws in these laws. Define clear and severe penalties for those who lend, borrow or misrepresent PCAB licenses.