The mounting clamor to abolish the Procurement Service of the Department of Budget and Management (PS-DBM) is well grounded. It has been at the center of several anomalies involving scarce public funds, from the disgusting Pharmally scam relating to the wastage of funds of the Department of Health (DOH) earmarked for pandemic supplies, to the controversial purchase by the Department of Education of laptops for teachers that the Commission on Audit (COA) claimed were pricey yet outdated.
The Makabayan bloc in Congress is the latest to revive calls for its abolition, filing last week House Bill No. 3270 which seeks to return to government agencies the role of purchasing their own supplies. “The directive of the 1987 Constitution to maintain honesty, integrity, and transparency in public service, and Republic Act 9184, or the ‘Government Procurement Act,’ which mandates all procurement entities to establish a single bids and awards committee (BAC), have made the PS-DBM archaic and irrelevant,” the Makabayan lawmakers said in the explanatory note of the bill. “Worse, it became a breeding ground for graft, corruption, inefficiency, and negligence of the duties of other government agencies.”
Also last week, COA again called out PS-DBM for not exercising due diligence in approving contracts for P1.386 billion worth of medical supplies for COVID-19 frontliners, noting that the deals entered into from December 2020 to May 2021 involved personal protective equipment (PPE) and surgical masks that lacked the required documents and were thus not authorized for sale or for public use.
When both houses of Congress finished investigating the transfer of P42 billion by the DOH to PS-DBM for the purchase of face shields, face masks, PPEs, and other pandemic-related supplies, P8.7 billion of which was awarded to Pharmally, they both agreed on the need to abolish PS-DBM. The House committee on good government and public accountability, in its report last January, said that the PS-DBM should be abolished as it has already “outlived its purpose,” considering that all agencies now have their own procurement department and BACs.
The various procurement anomalies hounding PS-DBM indeed warrant the need to abolish this major source of corruption. However, there is the more important need to address the root cause of the problem, which is the inadequacy of various government agencies to spend their budgets.
As Sen. Sherwin Gatchalian pointed out, government agencies have developed the “bad habit” of sending funds they had not spent to PS-DBM so they would not be accused of having a low utilization rate of their budget. Sen. Joel Villanueva added that the reason why agencies dump their funds on PS-DBM is to extend the validity of the fund allotments. “I wonder why the DBM, which is a proponent of timely spending of funds, not only entertains but seems to encourage this kind of simulated spending,” he noted.
The Marcos Jr. administration must heed the numerous calls to abolish PS-DBM, which in so doing will help it remove one major source of corruption. But it must first improve the capacities of departments and agencies to spend their budgets in a timely manner.
Failing in this, funds that otherwise would have gone to the purchase of equipment and supplies needed for the effective delivery of public services would just remain idle and revert to the national treasury, to the detriment of their intended beneficiaries.
Improving the absorptive capacities of the government departments and agencies, or their ability to spend their budgets on time, can be enhanced by boosting or improving their BACs, through the digitalization of bidding and awarding processes not only to speed them up, but also to rid these of red tape and loopholes for corruption. The BAC in each government agency can be strengthened by ensuring that a procurement operation manual for all offices and agencies of the government is available and for the DBM to conduct procurement training programs regularly.
The DBM should also consult with key agencies that are finding it difficult to spend their budgets to identify the bottlenecks in the implementation of programs. It must help them find ways to accelerate the implementation of their procurement programs on time.
It is also important that when the government decides to scrap PS-DBM, it should not mean forgetting about the wrongdoings of the past. As proposed in the bill filed by the Makabayan bloc, the government must direct COA to do a special audit of PS-DBM which can be the basis for filing administrative and criminal cases before the Office of the Ombudsman against those who would be found involved in irregularities. The Marcos Jr. administration should ensure that those who violated the law using the anomaly-ridden procurement scheme face the consequences of their misdeeds.
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